Foreclosure is a judicial process in which a mortgage lender recoups some of its losses in the event of default by taking possession and/or ownership of the home that secured the loan in the first place in Lynchburg, Tennessee Foreclosure often requires the house to be sold at auction. Often, banks want to get rid of the property as soon as they can, in order to gather as much money as possible, and move on.
In all states in the U.S., including Tennessee, 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 some states, original mortgages are "non-recourse loans," meaning that the lender can 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 Lynchburg, Tennessee lawyer to see if this state is one of them. However, it is almost always the case that this protection does not apply to loans which have been refinanced.
How Can I Avoid Foreclosure in Tennessee?
First, you should never ignore the matter. As unpleasant as it seems, it is essential to stay on top of the issue. Ignoring the problem will never make it go away. It is necessary to remember that the bank does not really want your Lynchburg 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 no deal can be worked out, or the mortgage payments have become prohibitive, you might consider a "short sale". While the lender has to consent to it, many will take a moderate loss if it means avoiding foreclosure (which lenders typically treat as a last resort). This allows you to sell the house for whatever price it can fetch on the current market, and hand the proceeds over to the bank. If the sale nets less than the balance, some or all of the deficiency might be forgiven. You may also consider a "short refinance" which allows a chunk of the debt to be forgiven, and lets you refinance the rest.
How Can A Lynchburg, Tennessee Attorney Help?
If you are faced with the possibility of foreclosure in Lynchburg, Tennessee, an attorney might be able to help. At the very least, he or she can advise you of your legal options.