Foreclosure is the procedure 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 Edinburgh, Indiana has consistently failed to make their payments. Foreclosure usually involves a forced sale of the house at auction. Banks usually want to rid themselves of ownership of the home as soon as possible, collect as much money as they can, and then move on.
In all states in the U.S., including Indiana, foreclosure by judicial sale is allowed. Under this system, the sale is overseen by a court of law, to ensure that the bank makes a good effort to get a reasonable price at the auction, and that any proceeds above the balance of the mortgage go back to the borrower. 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 an Edinburgh, Indiana lawyer to see if this state is one of them.
How Can I Avoid Foreclosure in Indiana?
First and foremost, you should not dismiss the possibility of foreclosure. Failing to respond to collection calls from your lender will not make the problem go away. As unpleasant as this may seem, you should stay in contact with your creditor, and be honest with them. One should remember that banks generally don't want to take your house in Edinburgh. They issued your mortgage expecting to earn a profit on the interest. Taking possession of, and selling, your house is a last resort for them. Therefore, if you are honest with them about your financial situation, they are likely to make reasonable accommodations to keep you from defaulting.
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. There is also the option of a "short refinance," which forgives a significant portion of your mortgage debt, and refinances the rest.
How Can A Edinburgh, Indiana Attorney Help?
If you think foreclosure is imminent, a good Edinburgh, Indiana 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.