How Does A Home Foreclosure Process Work?

If you are one of the hundreds of thousands of people that are currently facing a foreclosure today you may be wondering how the foreclosure process works. Please keep in mind that this is dependent on a state by state bases and it could also vary depending on the terms of your mortgage agreement. I also cannot offer any legal advice. What I can offer is some generalities that may sum up how the foreclosure process works.

First of all one of the most commonly asked questions is when will your credit score be affected? Your credit score will be affected from the very first missed mortgage payment or partial payment, however you will not actually start the foreclosure process until after your third missed payment. A foreclosure will not be finalized until after the sheriff’s sale which takes place after your seventh missed payment.

Once you miss three consecutive payments the foreclosure process will begin. Generally, you will no longer have the option to pay a partial payment, however this will be at the discretion of your mortgage company. A partial payment is considered to be anything less than the total amount that is owed to the mortgage company at that point. That means that even if you are able to pay the normal monthly payment at that point, it still may not be accepted. The only payment that will be accepted is the entire amount of all the missed payments as well as the amount of any late penalties or legal fees that have been assessed. There are exceptions that are at the discretion of your mortgage company.

Once you have missed your sixth payment you will receive notice of the date of the sheriff’s sale, typically scheduled at the end of month seven. You can save your home at point up to the sheriff’s sale by paying the total of the amount owed plus any fees that have been assessed.

Once the sheriff’s sale has commenced you will begin your redemption period. The redemption period varies from state to state but is typically between 3 and 6 months. Typically you can still save your home at any time during this period, however at this point you would have to pay the mortgage in its entirety. You are legally able to stay in your home during the course of the redemption period. Once the redemption period has ended you will be evicted.