Foreclosure is the legal process by which the lender in a mortgage arrangement takes possession of the property (typically a house) that secured the loan. This is done when the Culver City, California debtor has repeatedly failed to make their payments. Foreclosure often requires the house to be sold at auction. Often, banks want to get rid of the property as soon as they can, in order to make as much money as possible, and move on.
In all states in the U.S., including California, there is an option to go through foreclosure via judicial sale, in which a court oversees the sale, and makes sure that the proceeds first go to the lender, and then to any other entities that might have a lien or other interest in the property (in order of priority), and, finally, to the borrower, if anything is left. In some states, original mortgages are "non-recourse loans," meaning that the lender can only recover ownership of the house in the event of default. If the house is now worth less than the balance of the mortgage, the lender has to take the loss. You should speak with a Culver City, California lawyer to see if this state is one of them. However, it is almost always the case that this protection does not apply to loans which have been refinanced.
How Can I Avoid Foreclosure in California?
First, and most importantly, you should not ignore the issue. Failing to respond to foreclosure calls from your lender will not make a problem go away. You should stay in touch, and be forthright with, your creditor as much as possible. It is crucial to remember that banks don't really want to own homes in Culver City. 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 can't work anything out with your lender, or have become completely unable to make any mortgage payments, a "short sale" might be a good option. This allows you to sell your house for whatever price it can get, and hand the proceeds over to the lender. If the sale price is less than the balance of the loan, the rest of the debt might be forgiven. A "short refinance" might also be an option in some cases. This allows you to have some portion of the debt forgiven, while refinancing the rest.
How Can A Culver City, California Attorney Help?
If you are facing foreclosure, a good Culver City, California real estate attorney can help. While keeping your home might not always be possible, a lawyer can increase your odds of success, and help you minimize the negative impact if you do end up losing your home.