Foreclosure is the legal procedure by which the lender in a mortgage arrangement takes possession of the property (usually a house) that secured the loan. This is done when the La Canada Flintridge, 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 collect as much money as possible, and move forward.
In all states in the U.S., including California, there is an option to go through foreclosure via judicial sale, in which a court supervises the sale, and makes sure that the proceeds first go to the lender, and then to any other entities that may have a lien or other interest in the property (in order of priority), and, finally, to the borrower, if anything is left. In various states, mortgages which have not been refinanced are "non-recourse loans." This means that, in the event of default, the bank can take ownership of the house and sell it; but if the sale price happens to be less than the balance of the mortgage, the lender cannot go after the debtor for the remainder. Because of this, some people have found that their best option is to simply walk away from the home if the mortgage is more than the house is worth. You should talk with a La Canada Flintridge, California lawyer to see if this state is one of them.
How Can I Avoid Foreclosure in California?
First, you should never dismiss the matter. As unpleasant as it seems, it is necessary to stay on top of the issue. Ignoring the problem will never make it go away. It is crucial to remember that banks don't really want to own homes in La Canada Flintridge. 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 allow you to keep paying them in the long run.
If you can't work anything out with your lender, or have become totally 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 may be forgiven. You could also consider a "short refinance" which allows a part of the debt to be forgiven, and lets you refinance the rest.
How Can A La Canada Flintridge, California Attorney Help?
If you think foreclosure is imminent, a good La Canada Flintridge, California lawyer may be your best hope for staving it off. Even if keeping the house proves impossible, a good attorney can minimize the financial effects.