At Premier OKC Home Buyers, we have a ton of experience helping homeowners facing foreclosure in Oklahoma City. We get a lot of the same questions time and time again so we thought it would be a great idea to share those questions and answers with the community. If you have a question about foreclosure that is not answered below, please contact us.
What is foreclosure?
Foreclosure is the legal means that your lender can use to repossess, or take back, your home. When this happens, you must move out of your house. If your property is worth less than the total amount you owe on your mortgage loan, a deficiency judgment could be pursued. If that happens, you not only lose your home, you also would owe your lender an additional amount. Both foreclosures and deficiency judgments could seriously affect your ability to qualify for credit in the future. So you should avoid foreclosure if possible.
What should we do about missed mortgage payments?
First, do not ignore letters from your lender regarding missed mortgage payments. Ignoring the issue will only make things worse. If you’re having problems making your payments, call or write to your lender’s loss mitigation department as soon as possible and explain your situation. Be prepared to provide them with financial information, such as your monthly income and expenses. Without this information, they may not be able to help.
Should I stop paying my mortgage to qualify for a loan modification?
No. You don’t have to default on mortgage payments in order to get a loan modification. It’s also a bad idea to do so. With a loan modification, your lender will agree to modify the terms of your mortgage. You’ll either be given a better interest rate or the length of your mortgage will be extended in order to lower your overall monthly payment. Contact your lender immediately to see if you qualify.
What happens to judgment liens during foreclosure?
If a judgment lien is on your home, and that property is foreclosed, the judgment lien is wiped out.
When do you have to leave your home when it’s in foreclosure?
In some instances, panicked homeowners leave their home after missing a few mortgage payments or once a foreclosure is initiated. However, you have the legal right to remain in your home until the foreclosure process is completed. This process can take a few months or, in some cases, as much as a year.
What’s a default judgment in a foreclosure?
If you don’t respond to a foreclosure lawsuit, the foreclosing party will ask the court for a default judgment. So in short, always respond to your lender and to the courts.
Can I lose my home to foreclosure if I don’t pay for homeowners’ insurance?
It can happen but it’s not all that common. This really depends on your lender and the relationship you have with them. If you breach your mortgage contract’s terms by not having homeowners’ insurance, you might face added costs and possibly foreclosure.
Are there alternatives or solutions to avoid foreclosure?
Yes. You may qualify for a number of alternatives to the foreclosure process, including special forbearance, in which your lender may be able to arrange a repayment plan based on your financial situation, and may even provide for a temporary reduction or suspension of your payments. Other foreclosure alternatives include mortgage modification and a deed-in-lieu of foreclosure. You also have the option of selling your home to a local cash home buyer like Premier OKC Home Buyers.