Foreclosure is a judicial procedure allowing mortgage lenders to take ownership and/or possession of the debtor's real estate (which was used to secure the loan) in the event of nonpayment in Farmington, Missouri. 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 Missouri, 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 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 Farmington, Missouri 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 Missouri?
First, and most importantly, you should not dismiss the issue. Failing to respond to foreclosure calls from your lender will not make an issue go away. You should stay in touch, and be honest with, your creditor as much as possible. You should keep in mind that banks usually don't want to take your Farmington home. They aren't in the real estate business, and expect to make money through interest on the loan, not by selling your house. If you are up-front with them early on, they will probably make a reasonable effort to accommodate your financial system if it will prevent you from defaulting.
If you believe that foreclosure is imminent, there are some other avenues. For example, you may be able to engage in a "short sale," which sometimes allows you to sell your house for whatever amount you can receive, give the proceeds to the lender, and walk away free of your mortgage debt, even if the sale netted less than the balance of the mortgage. 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 Farmington, Missouri Attorney Help?
If you are worried about foreclosure, a good Farmington, Missouri real estate Attorney may be able to help. An Attorney can increase your chances of keeping your home, and help minimize the financial impact if keeping it proves impossible.