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There are generally two types of property foreclosures in the U.S.: judicial and non-judicial foreclosures. It can be helpful to see a timeline of how nonjudicial foreclosures generally proceed.
Judicial foreclosures: Judicial foreclosures take place through the state court system. While all states allow judicial foreclosures, some require it.
Non-judicial foreclosures: When taking out a loan in a state that primarily uses a nonjudicial foreclosure process, you sign a deed of trust/mortgage that often contains a power of sale clause. If you have a power of sale provision in your mortgage contract, the lender can foreclose without going to court. Even if a state opts for nonjudicial foreclosures, judicial foreclosures are allowed in some circumstances.
Laws and procedures can change, so be sure to research which type of foreclosure process is used in your state.
It's worth restating that foreclosure procedures vary by state. That said, here's a general breakdown of how the process typically goes:
First month missed payment – your lender will contact you by letter or phone. A housing counselor can help.
Second month missed payment – your lender is likely to begin calling you to discuss why you have not made your payments. It is important that you take their phone calls. Talk to your lender and explain your situation and what you are trying to do to resolve it. At this time, you still may be able to make one payment to prevent yourself from falling three months behind. A housing counselor can help.
Third month missed payment – after the third payment is missed, you will receive a letter from you lender stating the amount you are delinquent, and that you have 30 days to bring your mortgage current. This is called a "Demand Letter" or "Notice to Accelerate". If you do not pay the specified amount or make some type of arrangements by the given date, the lender may begin foreclosure proceedings. They are unlikely to accept less than the total due without arrangements being made if you receive this letter. You still have time to work something out with your lender. A housing counselor can still help.
Fourth month missed payment – now you are nearing the end of time allowed in your Demand or Notice to Accelerate Letter. When the 30 days ends, if you have not paid the full amount or worked our arrangements you will be referred to your lender's attorneys. You will incur all attorney fees as part of your delinquency. A housing counselor can still help you.
Sheriff's or Public Trustee's Sale – the attorney will schedule a Sale. This is the actual day of foreclosure. You may be notified of the date by mail, a notice is taped to your door, and the sale may be advertised in a local paper. The time between the Demand or Notice to Accelerate Letter and the actual Sale varies by state. In some states it can be as quick as 2-3 months. This is not the move-out date, but the end is near. You have until the date of sale to make arrangements with your lender, or pay the total amount owed, including attorney fees.
Redemption Period – after the sale date, you may enter a redemption period. You will be notified of your time frame on the same notice that your state uses for your Sheriff's or Public Trustee's Sale.
This article is intended to be helpful and informative. But even common legal matters can become complex and stressful. A qualified foreclosure and alternatives lawyer can address your particular legal needs, explain the law, and represent you in court. Take the first step now and contact a local foreclosure and alternatives attorney to discuss your specific legal situation.