A mortgage foreclosure is where the bank or lender starts a lawsuit by serving a summons on the homeowner. This is typically done with the homeowner is at least three months behind on their mortgage payments. The bank will file a foreclosure complaint against the homeowner seeking to accelerate the entire amount due on the loan and sell the property on the Court steps at a foreclosure sale. The homeowner typically has only twenty (20) days to respond to the summons and complaint. If the homeowner does nothing, the bank will take a default judgment in the foreclosure against the homeowner. The bank will then apply to the court for a final hearing where the foreclosure sale ate will be set by the Court. At the foreclosure sale, anyone my purchase the property, but the bank will likely not accept any bid lower then their judgment amount. This typically means that the bank buys the property at the foreclosure sale. The bank then has the right to send the sheriff to the property to remove the homeowner and all occupants. The bank or lender also has the ability to take a deficiency judgment against the homeowner for the difference between what the property is worth and the judgment amount. Additionally, the foreclosure judgment has a negative effect on the homeowner’s credit score.
While a homeowner can defend the foreclosure process themselves, it may be advisable to seek the advice of an attorney who handles these types of cases. In some situations, there may have been predatory lending practices used when the homeowner got the loan. There also may be other valid grounds to defend the foreclosure, alleging that the loan is void and should be rescinded completely.