What is Foreclosure in Livingston, California?
Foreclosure is the legal procedure by which the lender in a mortgage arrangement takes possession of the property (normally a house) that secured the loan. This is done when the Livingston, 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 gather 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 Livingston, California lawyer to see if this state is one of them.
How Can I Avoid Foreclosure in California?
First of all, you shouldn't dismiss the problem. You should stay in contact with your bank, and be straightforward with them. Ignoring the issue will not make it go away. It is essential to remember that the bank does not really want your Livingston house - they expected to make a profit through the interest on your loan, and that's what they'd prefer to do. Accordingly, they will probably make reasonable accommodations to your financial situation if it means that you will be able to make some form of payment to them.
If no deal can be worked out, or the mortgage payments have become prohibitive, you may consider a "short sale". While the lender has to consent to it, many will take a moderate loss if it means avoiding foreclosure (which lenders typically treat as a last resort). This allows you to sell the house for whatever price it can fetch on the current market, and hand the proceeds over to the bank. If the sale nets less than the balance, some or all of the deficiency may be forgiven. You may also consider a "short refinance" which allows a part of the debt to be forgiven, and lets you refinance the rest.
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How Can A Livingston, California Attorney Help?
If you are worried about foreclosure, a good Livingston, California real estate attorney may be able to help. A attorney can increase your chances of keeping your home, and help minimize the financial impact if keeping it proves impossible.