What are the stages of foreclosure?

On Behalf of | Dec 6, 2020 | Blog |

If you fall behind on your mortgage payments, then you face foreclosure. Your lender can take ownership of your home due to you failing to honor the financial agreement you made when you bought your home. 

The law dictates the foreclosure process. According to the Michigan State Housing Development Authority, a foreclosure begins the day after your payment due date. 

First 45 days

Once you miss a payment, your lender will apply fees and other charges to your account. Your lender must contact you by phone to let you know about its next steps. Your lender may give you options to catch up on your missed payments. 

By the 45th day after your missed payment, your lender must provide you with a written notice that tells you about your delinquency. It must also provide you with options to bring your account back to good standings. Some lenders will appoint an attorney in your case and have you attend a meeting to negotiate your next moves. 

After day 121

You have until the 121st day after your missed payment to work something out with your lender.  However, if you fail to come to an agreement and work things out, the foreclosure process officially starts. The lender will publish a Sheriff’s sale date in the newspaper for four days. Then, it will hold the sale. 

Once the house sells at the auction, you will usually have six months to try to bring your mortgage current with payments. You may also continue to live in the home, but you do have to maintain the home and allow any inspections. You also can sell the home during this time. 

You lose your rights to the property after this period. You will go to court and receive a date when you must be out of the home.