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 Lorain, Ohio. When a house is foreclosed, it is typically sold at auction shortly thereafter. This is because banks typically want to get rid of the property as soon as possible, even if it means losing some money, and an auction is an easy way to do this.
In all states in the U.S., including Ohio, foreclosure by judicial sale is allowed. Under this system, the sale is overseen by a court of law, to ensure that the bank makes a reasonable effort to get a decent price at the auction, and that any proceeds above the balance of the mortgage go back to the borrower. In some states, original mortgages are treated as "non-recourse" loans, meaning that, at most, the lender can take ownership of the house in the event of foreclosure, even if it is worth less than the amount due. The bank cannot go after the debtor for the remaining balance once it sells the house. You should consult a Lawyer in Lorain, Ohio to find out if this is the case here. This typically does not apply if the mortgage has been refinanced.
How Can I Avoid Foreclosure in Ohio?
First, and most importantly, you should not ignore the issue. Failing to respond to foreclosure calls from your lender will not make a problem go away. You should stay in touch, and be forthright with, your creditor as much as possible. You should remember that banks in Lorain 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 forthright with them, lenders will typically 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 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. You might also consider a "short refinance" which allows a chunk of the debt to be forgiven, and lets you refinance the rest.
How Can A Lorain, Ohio Attorney Help?
If you are faced with the possibility of foreclosure in Lorain, Ohio, an Attorney might be able to help. At the very least, he or she can advise you of your legal options.