The Four Steps of the Foreclosure Process

Although there general guidelines from the federal government about foreclosures, each states has its own specifics that will apply. There are two types of foreclosure; judicial foreclosures and non-judicial foreclosures. Judicial foreclosure will have action from the court, while non-judicial are done outside the realm of the court. The criteria for a judicial foreclosure is that a home is purchased through a mortgage; the criteria for non-judicial foreclosure is that a home is purchased through a deed of trust. Step 1. Delinquency of payment. Foreclosure proceedings begin when a homeowner becomes delinquent on payments. Typically this is usually when the borrower/owner is behind by three payments, but it can begin with one delinquent payment, depending upon the lender. Step 2. Notice of Default or Lis Pendens. This is known as the pre-foreclosure phase of the process. The lender will have a trustee record the Notice of Default at the county recorders office. It's during this time the borrower still has the opportunity to reinstate the loan or pay it off. It is also during this period that the bank accelerates the payment, requiring the borrower to pay the mortgage in full; no payments accepted. There is a period of 3 months before final proceedings begin. Step 3. Notice of Sale. The borrower will receive by registered mail or by the delivery from the Sheriff the Notice of Sale, or Notice to Foreclose. There will be a sign posted on the property with the Notice of Sale with the time and location of the sale. The information will be recorded at the county recorder's office, and published in the local newspaper in the county where the property is located over a period of three weeks.