Mortgage Foreclosures

rauschendes
Mind Map by rauschendes, updated more than 1 year ago
rauschendes
Created by rauschendes almost 5 years ago
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Description

1. What remedies might a borrower seek to prevent foreclosure? 2. What are the steps to be taken in a non-judicial foreclosure? 3. What are the steps to be taken in a judicial foreclosure? 4. Difference between a strict foreclosure and an entry foreclosure.
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Resource summary

Mortgage Foreclosures

Annotations:

  • The process whereby the real property securing the loan is sold and the proceeds are used to pay the outstanding debt.
1 Loan Default Remedies
1.1 Shortsale
1.2 reinstatement of loan
1.2.1 FNMA/FHLMC

Annotations:

  • The borrower is required to pay delinquent sums and late charges.
1.3 forbearance agreement

Annotations:

  • It's an agreement in which the lender agrees to refrain from foreclosing on the property and the borrower postpones and/ or reduces payments for a period of time.  It may apply if the borrower is facing health issues or temporary unemployment. 
1.4 Deed in lieu of foreclosoure
1.5 File for bankruptcy
2 No Sale Takes Place (2 Types of Foreclosure)
2.1 Strict Foreclosure

Annotations:

  • A court hearing determines a lender's right to foreclose.  The property is transferred to the lender.  The defendant-borrower receives nothing because no sale has taken place. 
2.2 Entry Foreclosure

Annotations:

  • The lender takes possession of the property and after a specified time period receives title to the property
3 Non-Judicial Foreclosure

Annotations:

  • Primarily occurs in deed of trust states. 
3.1 1. Trustee records a notice of default
3.1.1 2. Notifies the borrower that property may be sold without court action
3.1.1.1 3. Notice of trustee's sale is published
3.1.1.1.1 4. Public auction is held
3.1.2 Redemption Period
3.1.2.1 Notice of Rescission
3.2 Paralegal prepares
3.2.1 1. Demand Letter
3.2.1.1 2. Notice of Default
3.2.1.1.1 3. Notice of Trustee's Sale
3.2.1.1.1.1 4. Trustee's Deed
4 Judicial Foreclosure
4.1 1. Filing of a complaint naming borrower and all parties with interests
4.1.1 Judgment: court authorizes sale of property
4.1.1.1 Redemption Period

Annotations:

  • The borrower pays loan, plus penalties, costs and attorneys' fees.
4.1.1.2 clerk of the court issues a certificate of sale
4.1.2 Default Judgment
4.2 Paralegal prepares
4.2.1 1. Demand Letter
4.2.1.1 2. Complaint
4.2.1.1.1 3.Notice of lis pendens
4.2.1.1.1.1 4. Motion for Default
4.2.1.1.1.1.1 5. Motion for Summary Final Judgment
4.2.1.1.1.1.1.1 6. Supporting Affidavits
5 Lien Theory States
6 Title Theory States
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