How does a foreclosure work?
I'm very concerned about my friend. I don't know all the details, but she told me about a month ago she was 3 months past due on her mortgage, she's 4 months now since the bank has stopped taking payments. Idon't think they've made a mortgage payment on time in the last 3 years. The truth is she has very poor money management skills, and her husband is even worse. It's more important to have a cell phone with all the texting and internet, and the 400 tv channels, or to go on vacation, then it is to pay the bills.
Well, she told me she got an letter from the bank stating that they needed to pay by July 5th. She said she they sent in 2 bank checks equal to 2 payments, but the bank sent them back and told them they could not make partial payments. It's all very confusing, because she gives me conflicting information. She said they need about $8,000, but the bank won't give them an exact amount. Monthly payments are about $1,200 (more with late fees), so I would think 4 months would be arround $5,500? Anyway she should have the moey by the end of August (from a pending legal settlement), and she seems to think at that point she can just pay what is owed. I'm sure it doesn't work like that, but I really don't know.
Bankruptcy is not an option. I know they can't refinance or loan modifcatio,etc.
So my question is, how does this process work?
Thank you ladies for helping me to better understand the process. I agree with you that it's something she needs to work out for herself. As we all know, It's hard to watch those we love go through difficult times.
I don't feel bad for people (as you described) like this. Sounds like they didn't care so why should you?
With this mortgage crisis it's hard to say how long the bank will take to kick her out, it typically takes at least 18 months. She has been getting several notices already with a deadline to pay the entire balance & the next notice should be that she is being served to get out.
It's best if you just let it go, hmmm just like she did.
I'm sure she appreciates that you're worried for her, but I'm also sure that she knows exactly what needs to be done to get herself back in good standing enough to keep her home. When the bank says it won't accept partial payments even though she has "two payments worth" here's what's happening. The bank wants the full $8K as one full payment. Your friend is offering up only $2,400 even though it would be worth two months mortgage. The bank is saying, "Nope, we're past that monthly payment thing, you've racked up enough missed payments that we want them all in one lump sum payment rather than in bits and pieces. We want our money."
So your friend has to hold on to that $2,400 until she gets the remainder of the $8K plus penalties and fees and give it to the bank all at once. And they need to give it to the bank by the date the bank gave them or I'm betting the bank can begin the process of eviction. I just had some good friends go through this across the street. It's sad, but you can't make your friend's problem your problem. They got themselves into it and they have to get themselves out of it.
The bank has it's lawyers send this letter that has the total amount owed plus late and legal fees. The person must pay this amount by the date specified to "keep" the house and become current.
If the payment is not made, the foreclosure process will start. It will depend on the area and how saturated the courts are with foreclosures as to how quickly a sherriff's sale will take place. If I remember correctly, once the house sells (usually an auction on the court house steps) the family has to be out with a minimal amount of time, like that day or 24 hours or something.
If there is no bankruptcy, the family COULD have their paychecks garnished for the difference of what they owed minus what the house sold for. I don't know if the banks and courts have kept up with this part of it and a lot of people are walking scott free.
They need to talk to an attorney who knows about foreclosures. A bankruptcy attorney will generally advocate a bankruptcy....that is how they make their money.
Could they get rid of some other bills and come up with enough money on the short hand? Do they really want to keep their house? Can they really afford it with the type of lifestyle they want to live?
Some people need to learn the hard way and it sounds like your friend might be one of them. You can't feel sorry for people who make bad choices (constantly).
She needs to be the one figuring this stuff out. JMO.
Honestly, if you were my friend and I confided in you with serious personal issues and you put my business in the street (or in this case the super highway), in the manner in which you have, I would be so hurt and mortified, I don't think we could be friends anymore.
Blessings.....
We are at the end of a short-sale thru our mtge co. We are actually closing on the 29th of this month w/our house. The bank should've been offered them loan modification & when they didn't qualify, then some type of foreclosure/short-sale program (either a traditional or hafa - the hafa one forgives you of the difference you owe after you go thru a bazillion hoops).
With all of the gov't programs out there and non-profit organizations, it is almost impossible not to get help, not financial help, but at least some type of guidance.
The best thing for them to do is to call the mtge co & be straight up w/them, it doesn't matter what you'll be coming into when, it's what you have in your hand now (unfortunately) and possibly that would help them by being better qualified for another program.
It is a pretty crappy thing to go thru but it is a wonderful thing that she has you being so concerned for her.
She needs to contact the bank and explain the situation and see if she can work out a financial arrangement. If they refuse, they are within their legal rights to forclose, but most banks try to avoid that and will work with her if they are reasonably assured that they will indeed receive payment.
dont know but can call and explain they sometimes work with you although she has a bad history cant hurt to ask
