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State Foreclosure Laws
By Susan Willets | June 11, 2008
Get the Facts About Your State’s Foreclosure Process
The mortgage holder can usually initiate foreclosure at a time specified in the mortgage documents, typically some period of time after a default condition occurs. Two main types of foreclosures exist: judicial and non-judicial, or power of sale.
Judical Foreclosure
Foreclosure by judicial sale, also known as judicial foreclosure, involves the sale of the property under the supervision of a court. The proceeds from the sale are used for the following: first, to payoff the mortgage, second, payoff any additional lien holders, and finally, any remaining funds go to the borrower. As with all legal actions, all parties must be notified of the foreclosure, but the requirements of notification vary from state to state.
Non-Judicial Foreclosure
Non-judicial foreclosure, or foreclosure by power of sale, is allowed by many states if there is a power of sale clause included in the mortgage. This process involves the sale of the property by the mortgage holder without the supervision of the courts. It is slightly less complicated and therefore quicker than foreclosure by judicial sale. The proceeds from the sale are used in the same order with the mortgage and any additional lien holders receiving the funds from the sale first.
If you are facing foreclosure or are currently going through foreclosure, it’s imperative that you know how the law works in your state. You need to be aware of what rights you have as a homeowner and what rights your lender has as well. Review your mortgage agreement carefully and click on your state below to find out more details about the laws in your state.
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Topics: Foreclosures Overview |