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 St. Joseph County, Indiana has consistently failed to make their payments. Foreclosure typically involves a forced sale of the house at auction. Banks typically 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 every state, including Indiana, borrowers have the option to go through foreclosure by judicial sale. This means that the auction will be supervised by a court, to make sure that the bank makes an effort to get as high a price as possible (to increase the chances that the whole balance will be covered, as well as the odds that there will be some money leftover for the debtor). In numerous 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 debtor for the balance, if the sale nets less than the amount due. You should consult an attorney in St. Joseph County, Indiana to learn the details of the law here. You should also know that this rarely applies to loans that have been refinanced.
How Can I Avoid Foreclosure in Indiana?
First of all, you shouldn't dismiss 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 crucial to remember that banks don't really want to own homes in St. Joseph County. 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 things out with your lender, there are other avenues. You can try a "short sale," which is when you sell your house for whatever amount you can get for it, and use the proceeds to pay your mortgage. If the house sells for less than you owe, the bank still receives those proceeds, but the remainder of the loan will be forgiven. A "short refinance" may also be an option in some cases. This allows you to have some part of the debt forgiven, while refinancing the rest.
How Can A St. Joseph County, Indiana Attorney Help?
If you are facing foreclosure, a good St. Joseph County, Indiana real estate lawyer can help. While keeping your home might not always be possible, an attorney can increase your odds of success, and help you minimize the negative impact if you do end up losing your home.