Homeowners default on their mortgage payment
When homeowners have trouble meeting their monthly mortgage note they face the risk of foreclosure. Foreclosure is when the bank or mortgage company takes back the home or property and the homeowner is forced to leave the home and vacate the premises. For a foreclosure proceeding to begin, the homeowner must be in default by not having been making their house payment for over three months. If the homeowner does not attempt to make payment arrangements or seek financial assistance with their payments, the bank will then record a notice of default with the county treasurer's office.
Legal proceedings begin to enact the foreclosure
After the notice of default has been filed, the court then sets a date for the foreclosure auction sale to take place. Generally, the homeowner who is in default will receive by certified mail correspondence that a notice of sale has been granted to have the property auctioned off. A sheriff or other deputy will arrive at the property a few days later to post a copy of the notice of sale up on the property. The notice of sale will state the date and time that the property will go on the auction block at the county court house. Publicly, this information is displayed where it can easily be seen, such as on a front window, door or even tree in the front yard. Newspapers and inquiring realtors will also be notified about the foreclosure and the notice of sale.
The foreclosed home goes on the auction block
As the date approaches for the home to go on the auction block, the lender may send a representative to the home or property to remind the homeowner that the house will be going up for auction and they will need to vacate the premises after the sale is complete. The morning of the auction, the public is invited to attend. Typically, it is held outdoors on the steps of the courthouse by a sheriff or county clerk. The starting bid is usually the amount of the balance owed on the property along with the fees and court costs associated with the loan. If the starting bid does not win any bidders the price can decrease. The home is bid off in thousand-dollar increments and sold to the highest bidder. If no one buys the home, an appointed real estate agency appointed by the lender will then attempt to sell the home. The new homeowner has 30 days to cash out the property so that the legal process can begin and the title and deed can be transferred and the sale completed.