How many skipped mortgage payments before the bank can begin foreclosure?
It is unusual that a lender would begin the foreclosure process over one late or missed payment, but this doesn’t mean it’s an advisable action. If you find yourself in a situation that you cannot meet the dealing or simply forgot to mail off the check, act quickly to ensure you get back on track before losing your home.
Grace Period on Late Payments
The majority of mortgage lenders allow a few days after the initial due date to accommodate the occasional late payment. If made within the set time, usually 15 days, it is possible to avoid additional fees added on as penalty. A payment is not considered missed until a full 30 days have passed, and at this point the lender will reach out with a notification letter. Enclosed are the details of a final opportunity to make the payment before the home is officially moved into the pre-forclosure process.
A home will never go into foreclosure without the homeowner being fully aware of the proceedings. Lenders make multiple attempts to reach out to help clients avoid losing their home, usually by restructuring payments at a lower rate. At this point, most people are able to get back on track by accepting the new terms. If rejected, there is no other option for the bank than to put a foreclosure into motion.
Formal Default Notice
A failure to reach an agreement on lower payments forces the lender to go on record with the county clerk filing a Notice of Default. Although this means that there is no more opportunity to save the home, there is still a couple of months left to relocate before being forced out. You can expect to receive a Notice of Sale three months after the process begins, and then the property goes on the market after another 20 days have passed.
Reclaiming Your Property
You have a right to reclaim the home within the redemption period of one year, if you are able to pay the entire mortgage balance and any additional fees. Unfortunately, if the home was purchased in cash, then the period drops down to only 90 days.
If you’re struggling with finances and are at-risk of losing your home, fill out the contact form to allow one of our specialists to advise you personally. Unless you didn’t make a payment within the last 3 months, it is possible to get back in good standings with the lender.