How Long Does It Take to Foreclose on a House?
A challenging real estate market tends to point to one thing: an increase in the number of homes threatened by foreclosure. If you own a home, are behind on payments and wondering how long you can hold onto your property before it is lost, then you're in good company. Fortunately, state and local laws slow down the process, with certain milestones to be reached before your home can be foreclosed.
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Definition
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According to Princeton University, "a foreclosure is the legal proceedings initiated by a creditor to repossess the collateral for loan that is in default." In this case the collateral is your home.
Missed Payment
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Most lenders extend a grace period for homeowners to send in their monthly payment. After 15 days, you can expect to receive a late notice with a service fee charged.
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Demand Letter
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Your lender will send out a breach of contract or demand letter some 45 to 60 days after your last payment has been received. You will then have 30 days to make good on your account.
Foreclosure Department
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After 90 days, your lender will refer your loan to its foreclosure department or to an attorney. Court filings, public notices and other warnings may be issued before your lender can proceed, depending on state law.
Auction
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After 150 days, your home can be sold at an auction or foreclosure sale. In some states that process can be extended for more than one year to help you straighten out your personal affairs.
Redemption Period
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Some states force homeowners out immediately upon foreclosure while other states give homeowners up to two months to repurchase the home if they are financially able to do so. Thus the foreclosure process could take from five to 12 months or more to complete.
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- Photo Credit Image by Flickr.com, courtesy of Mike Licht
