A foreclosure notice is a legal document from a lending firm that the property might be sold, auctioned, or confiscated if the borrower fails to make the payments. In this article, we have presented a sample of such a notice for your understanding.
A lender issues a foreclosure notice, also known as a notice of default, if it has been 90 days or more since the borrower missed a payment and has not paid up. Most of the lenders issue several ‘intent to foreclose’ letters before actually issuing this legal notification. This is in order to make the borrower come back on track with regards to the payments. It’s only when no other options exist that this notice is issued.
According to the state laws, a foreclosure notice cannot be sent to a borrower without displaying it publicly, in a local newspaper or at a public place. Nowadays, many lenders put it up on the Internet as well. There are several other financial consequences of this action. So, if you have missed a payment, try contacting your lender and see if he can help you. Another way to go is to find professional help, but be a bit careful as many unscrupulous people target such borrowers who are desperate to avoid losing their home. The agreement that you sign while taking the property on loan specifies the time frame after which foreclosure procedure can be initiated. Most of the states allow the mortgagor to stay in the house for six months to a year (varies with each state) after it has been auctioned. This is called the redemption period. During this phase, a borrower can buy back his house by paying the highest bidder at the auction, the price at which he bought the house.
Sample
| Date
Name Address Mr. ABC, This notice is regarding the nonpayment of dues of your mortgage. You have failed to make any payment in the last 90 days. You must make the payments on or before___________(date) by sending the amount mentioned below to__________(company name) in the form of a money order or certified check. The total amount due as of _____(date) is USD ___________ including interest of USD _________. To bring your account up-to-date, you must also include with the above payment, any payments or late charges that are due during this 30-day period. Acceptance of less than the total amount due would not waive off these late charges or other payments, if any. Acceptance of less than the total amount due also does not deter our right to sell your property, in case you fail to pay up the remaining amount later. If you are not able to make the outstanding payment in the next 30 days, then you will have to pay the total payable amount under the terms and conditions of our agreement. If you fail to pay, then____________(name of the company) will start legal action to foreclose on the mortgage, which will result in the property being put up for sale. You have the right to bring your loan current after the commencement of legal procedures. In accordance with your rights, you can also dispute our claim for foreclosure in the court of law, if you feel that you do not owe us. We assure you of all possible help and support to bring your account into good standing. We request you to contact ___________(name) at_____________ (telephone number) who will assist you in solving your current difficulty. Sincerely, (Signature) |
If you do not respond to this notice, then the lender is legally entitled to start the foreclosure process by filing the ‘notice of sale’. Even then, this process can be stopped or postponed if you bring your loan current or provide a written assurance to pay up within a certain amount of time. The most important thing to remember is that the lender is never keen on selling your property. The reason for that is he loses on the interest that you would have paid, and reselling a property always depreciates its cost. So, be assured that if you really want to save your property, you will find help. But, it does not mean that one should take advantage of this fact, because if you leave the lender with no choice, he will definitely have to auction your property. You must ensure that you are cooperating fully so that your property is saved from being foreclosed.
