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 Middle Island, New York. When a house is foreclosed, it is usually sold at auction shortly thereafter. This is because banks usually 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 New York, 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 treated as "non-recourse" loans, meaning that, at most, the lender can take possession of the house in the event of foreclosure, even if it is worth less than the amount due. The bank cannot go after the borrower for the remaining balance once it sells the house. You should consult an attorney in Middle Island, New York to find out if this is the case here. This usually does not apply if the mortgage has been refinanced.
How Can I Avoid Foreclosure in New York?
Most importantly, you must not dismiss the problem. Doing so will not make it go away, and will probably make it worse. You should stay in close contact with your bank, and be honest with them. It is necessary to remember that the bank does not really want your Middle Island 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 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 Middle Island, New York Attorney Help?
If you think foreclosure is imminent, a good Middle Island, New York 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.