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What Happens When A Bank Forecloses On A Mortgage?

By Jim Micheals

What happens when a bank forecloses on a mortgage? If the bank forecloses can I keep my personal property? Can a bank foreclosure be stopped in any way?

When a bank forecloses on a mortgage what they are doing is calling in a loan. They apply to the court for relief from a bad loan. The court in turn gives them the title to your home as a form of collateral payment. The bank then, in turn, sells the home in an effort to regain their losses from your loan. The foreclosure process can begin at anytime after you are 60 days late on your mortgage. The general rule is 4 months or more behind in payments before they begin a foreclosure. The proceedings itself can take anywhere from 1 week to 3 months to go through the courts.

If the bank forecloses can I keep my personal property?

If you are subject to a foreclosure you are entitled to keep all personal property that is not attached to the structure. Many states add in the words “permanently attached”, you will need to verify with your particular state. If you have recently installed a new door in the home you are not entitled to keep the door. You are entitled to keep all your personal belongs, furnishings, clothes and food. Removal of attached items may lead to further fines and penalties imposed by the court for damage to the property.

Can a bank foreclosure be stopped in any way?

A foreclosure can only be stopped by bringing the payments current. You have a few options to bring your mortgage current. You may raise the money and pay all the back payments due. You may try to refinance the mortgage, but this is very hard in today’s market. Or you may apply for a loan modification from your lender. Once approved this will bring your loan current and at a lower monthly payment.

Related posts:

1. If I Am Behind On My Mortgage Payments, Will They Take My Home?
2. Why Do Mortgage Rates Vary From Bank To Bank?
3. Why Would A Bank Modify My Mortgage Loan?
4. Can A Bank Change My Fixed Rate Mortgage?
5. What Happens To My Mortgage When My Bank Goes Bankrupt?