Second Mortgage Foreclosure Laws
When a homeowner finds themselves with a mortgage that is beyond their ability to pay, one of the options open for them is a second mortgage. A second mortgage is secured by real estate and the homeowner has a legal right to sell the property and pay off the loan in full. However, most homeowners who take out a second mortgage find themselves in financial trouble shortly thereafter. The foreclosure laws have been created to help keep people from losing their homes through foreclosure fraud. If you find yourself suddenly faced with the possibility of taking out a mortgage and find that you can't afford to do so, you may be able to protect your home by taking advantage of the foreclosure laws.
The foreclosure laws are designed to keep the property owner from being able to take the house and sell it to recover the money they owe. Foreclosure occurs when the lender forecloses on a home because the homeowner has fallen behind in the payments on the mortgage. The first lien holder on the property becomes the receiver of the deed. The second lien holder will soon be followed. If the homeowner falls behind again and cannot make the payments, https://nonjudicialforeclosuredefinition.tumblr.com/post/642204431936520192/non-judicial-foreclosure-definition the second mortgage becomes a lien against the property, which is enforceable by court order.
Homeowners who take out a second mortgage on their home and find themselves facing foreclosure may have some options available to them. They can attempt to work with the second mortgage company in an attempt to renegotiate the terms of the mortgage. If this does not work, foreclosure proceedings may be brought up before the Lender. If the Lender opts to foreclose, the homeowner still has some options available. The second mortgage companies policies may allow for the sheriff sale of the home if no reasonable offers are received.
The second mortgage foreclosure laws also give the bank protection in some circumstances. Banks are protected from a lien holder going into default with a second mortgage. If a homeowner falls behind on payments for two months, the second mortgage is put into escrow and becomes due if no money is received from the borrower. The second mortgage companies policy allows for the release of the loan in these situations.
If the second mortgage foreclosure is successful, the lender may re-purchase the home. The second mortgage companies policy on repossession varies based on the state. Most second mortgages have provisions for strict foreclosure or eviction proceedings if no efforts are being made to pay off the loan. In some states, a property owner can face an extra fine for each day their property is remaining in default. These are all details that the homeowner should be aware of.
When looking into a second mortgage foreclosure law, one should look into what the ramifications are of falling behind on payments. Depending on the state laws, it could result in the home being taken away from the homeowner and sold to pay off the second mortgage. This can be very stressful and financially embarrassing for the person in question. The best thing to do is to contact a second mortgage attorney who has experience with second mortgage foreclosure laws.