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. Louis, Michigan has consistently failed to make their payments. When a house is foreclosed, it is normally sold at auction shortly thereafter. This is because banks normally want to get rid of the property as soon as possible, even if it means losing some money, and an auction is an simple way to do this.

In every state, including Michigan, there is an option to go through foreclosure by a judicial sale, which is a process in which a court supervises the sale of the property, and makes sure that the proceeds first go the to the holder of the mortgage, then to anyone else who may have a lien on the property, and lastly to the debtor if anything is left. In some states, original mortgages are "non-recourse loans," meaning that the lender may 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 St. Louis, Michigan Attorney to see if this state is one of them. However, it is almost always the case that this protection does not apply to loans that have been refinanced.

How Can I Avoid Foreclosure in Michigan?

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. You should remember that banks in St. Louis don't want your house. While the foreclosure process can be devastating for the homeowner, it's no walk in the park for the bank, either. They expected to make a profit through interest on the loan paid over time, and foreclosure is a last resort, allowing them to cut their losses and move on. If you are straightforward with them, lenders will normally try to accommodate your changed financial situation, to avoid a default on your part, and the necessity of foreclosing on their part.

If you can't reach a solution with your lender, there are other options. You can, for example, try a "short sale," which allows you to sell your house for whatever amount you can get, and use the proceeds to pay your mortgage. If the house sells for less than you owe, the bank will receive the proceeds of the sale, and the rest of the debt will be forgiven. You may also try a "short refinance" which allows a piece of the debt to be forgiven, and the rest refinanced. This allows the bank to wash its hands of the matter, while taking a comparatively small loss, and allows the homeowner to keep their home.

How Can A St. Louis, Michigan Attorney Help?

If you are facing foreclosure, a good St. Louis, Michigan 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.