Foreclosure is the process through which the lender in a mortgage takes ownership and/or possession of the property that secured the original loan. This happens when a debtor in Methuen, Massachusetts has repeatedly failed to make their payments. Foreclosure typically results in the property being sold in an auction. Banks typically want to get rid of the property as soon as possible, even if it means taking a financial hit, and an auction is the easiest way to do this.
In every state, including Massachusetts, there is an option to go through foreclosure by a judicial sale, which is a procedure in which a court supervises the sale of the property, and makes sure that the proceeds first go the to the holder of the mortgage, then to anyone else who may have a lien on the property, and finally to the debtor if anything is left. In many states, original mortgages (as opposed to refinanced loans) are "non-recourse" loans, meaning that the most the lender can collect is whatever the foreclosed property sells for. The bank cannot go after the borrower for the balance, if the sale nets less than the amount due. You should consult a Lawyer in Methuen, Massachusetts to learn the details of the law here. You should also know that this rarely applies to loans which have been refinanced.
How Can I Avoid Foreclosure in Massachusetts?
First of all, you shouldn't ignore the problem. You should stay in contact with your bank, and be forthright with them. Ignoring the issue will not make it go away. It is essential to remember that banks don't really want to own homes in Methuen. In issuing a mortgage, they expect to make a profit through interest on the loan, and they'd prefer to continue collecting from you. Therefore, they're likely to make reasonable accommodations to your financial situation if it will enable you to keep paying them in the long run.
If you believe that foreclosure is imminent, there are some other options. For example, you might be able to engage in a "short sale," which sometimes allows you to sell your house for whatever amount you can get, give the proceeds to the lender, and walk away free of your mortgage debt, even if the sale netted less than the balance of the mortgage. You might also try a "short refinance" which allows a piece of the debt to be forgiven, and the rest refinanced. This allows the bank to wash its hands of the matter, while taking a relatively small loss, and allows the homeowner to keep their home.
How Can A Methuen, Massachusetts Attorney Help?
If you think foreclosure is imminent, a good Methuen, Massachusetts Attorney might be your best hope for staving it off. Even if keeping the house proves impossible, a good Lawyer can minimize the financial effects.