Security Instrument
The security instrument is either your mortgage or your trust deed. It's the contract that allows your lender to take your home if you default. States differ in what legally constitutes a security instrument. Most lenders are familiar with the foreclosure laws in the state where they conduct business, but consult with a legal advisor to make sure that your contract is legal and binding before you relinquish your home.
Judicial and Non-Judicial Foreclosure
Now this is some information foreclosure information. Most states offer judicial foreclosures and some states require that your lender go through the legal system to foreclose on your home. This type of foreclosure will give you the opportunity to plead your case.
Non-judicial foreclosure is power of sale foreclosure. This type of foreclosure does not require the supervision of the court. Because no hearing is required, the process is much quicker.
Initial Public Notice
Each state has different procedures that require your lender to inform you of their intent to foreclose and post some sort of public notice regarding the sale of your home. Check with your attorney general to make sure that your lender has followed the proper protocol with regard to your home.
Time Frame
Each state differs in the time frame that they allow for your lender to foreclose. During that time, you can cure your default and save your home. States vary from 60 days to 19 months, so be sure to consult with your attorney general to see how much time you have.
Redemption Period
Some states offer a redemption period, some don't. It's important to find out this foreclosure-related information. Some states only offer a redemption period if your foreclosure was judicial. During this period, you are able to buy back your home after the sale by your lender. However, you must pay the full amount owed on your mortgage plus fees. It's usually better to pay your mortgage to begin with, if you're able, than to have to buy your house back during the redemption period. It will save you a good deal of time, money, and heartache in the end.
Deficiency
These laws allow your lender to sue you for the difference if the sale of your home doesn't cover the balance you owe on your mortgage. Not all states have foreclosure laws that allow for deficiency judgments, so be sure to check with your attorney general before you worry about a lawsuit.
The best way to stop foreclosure is to communicate with your lender when it becomes difficult for you to make a payment. When possible you may even want to skip making a payment on another obligation before you skip paying your mortgage or home equity loan. Neglecting to pay your credit card bill can affect your credit, but one missed payment on your mortgage could cost you your home.