Foreclosure Owners Rights
After the housing meltdown of 2008, the federal government scrambled to help the throngs of American homeowners lurching toward foreclosure. The American Recovery and Reinvestment Act of 2009 was enacted with a provision to help these homeowners. In doing so, the federal government reaffirmed the rights of a homeowner during foreclosure.
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Right to Notice
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The mortgage holder must give the homeowner notice of intent to file foreclosure proceedings. The mortgage holder cannot rush the foreclosure through without this notification. Doing so may invalidate the foreclosure. Upon receiving the intent letter, the homeowner also has a right to a payment agreement or loan modification, especially that provided by the ARRA.
Right to Your Property
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Homeowners do have the right to get their property out of the house before it is sold. The bank or mortgage company cannot lay claim to the home's contents because the mortgage payments have been defaulted. They also cannot prevent the homeowner from entering the home to retrieve his property.
Right to Hearing
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Although the procedure may change according to the state, the homeowner has the right to present her side of the story. When the homeowner receives the first summons in the foreclosure proceedings, she must answer within the given amount of time. This is usually the only time to present a case before the judge. Failure to respond will result in foreclosure even if you are wrongfully losing your home.
Right to Excess Sale Proceeds
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Once the foreclosure is finalized, the home will be sold. However, just as the homeowner is responsible for any difference between the home's sale price and the balanced owed after foreclosure, he is also entitled to the excess funds if the home is sold for much more than the balance owed. A special request must be filed with the courts, usually within 10 days of the home's sale.
Right to Sue for Better Payments
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When the mortgage restructuring first began in late 2008, homeowners were inadvertently signing away their right to litigation for the chance to get a modification on the mortgage. If the homeowner did not like or could not afford the modified payment, there was no other way to get relief. Just before the ARRA of 2009 was enacted, homeowners were given the right to sue the mortgage holder for a more affordable modified payment. The new modification agreements also gave the homeowner the right to sue if the mortgage holder breached its part of the loan or tried to foreclose despite the agreement.
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