Foreclosure is a legal process 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 Salem, Missouri. 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 all states in the U.S., including Missouri, there is an option to go through foreclosure via judicial sale, in which a court oversees the sale, and makes sure that the proceeds first go to the lender, and then to any other entities that might have a lien or other interest in the property (in order of priority), and, finally, to the borrower, if anything is left. In many 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 borrower 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 Salem, Missouri attorney to see if this state is one of them.
How Can I Avoid Foreclosure in Missouri?
First of all, you shouldn't ignore 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 critical to remember that the bank does not really want your Salem 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 you can't reach a solution with your lender, there are other options. You could, 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 get the proceeds of the sale, and the rest of the debt will be forgiven. A "short refinance" might also be an option in some cases. This allows you to have some portion of the debt forgiven, while refinancing the rest.
How Can A Salem, Missouri Attorney Help?
If you are facing foreclosure, a good Salem, Missouri real estate attorney can help. While keeping your home might not always be possible, a lawyer can increase your odds of success, and help you minimize the negative impact if you do end up losing your home.