The Home Foreclosure Process

Whether you’re worried about the dangers of foreclosure or you’re considering buying a foreclosed property, here’s everything you need to know about foreclosures—what they are, how long they take, and the foreclosure process.

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What is a Foreclosure?

Foreclosure happens when a borrower becomes delinquent in their mortgage obligations, and the lender sells or takes ownership of the property.

When Does Foreclosure Begin?

Lenders will initiate foreclosure proceedings when borrowers become delinquent in their mortgage obligations, usually after three payments are missed. The lender will then notify the borrower in writing that he or she is in default.

What are the Owner’s Options?

The owner has four basic options once a lender has filed a public default notice:

  • The borrower can cure the default by paying the overdue amount and the pending payment after the notice of default is recorded.
  • The borrower can sell the property during the pre-foreclosure period to avoid having a foreclosure on their credit score.
  • The borrower can request a trustee’s sale or a judicial foreclosure, in which the property is sold at public auction.
  • The borrower allows the lender to repossess the property and it becomes a REO (Real Estate Owned) Property.

How Long Does the Owner Remain in Pre-Foreclosure Before the Sale?

Typically, the owner has 90 days between the Notice of Default and the Notice of Sale, then another 20 to 30 days until the auction. If the owner has not taken any action by the end of the pre-foreclosure period, the property will go to public auction.

How Does a Foreclosure Auction Sale Work?

The property is scheduled for public auction, which is open to any interested buyers. Rules for the auction and its proceedings vary from state to state; some states require cash or cashier’s check for the full amount be brought to the auction while others require only a percentage.

When Does the New Owner Take Possession?

Some sales allow the successful bidder to take possession immediately. If the former owner refuses to vacate the premises, the court can issue an unlawful detainer that allows the sheriff to come out and evict them.

Are You in Danger of a Foreclosure?

Borrowers should do everything they can to avoid foreclosure, which is one of the most damaging events that can occur in an individual's credit history. If you think you may be in danger of a foreclosure, contact your lender or your local real estate agent to learn more about your options.

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Interested in Buying a Foreclosure in Central Ohio?

If you’re thinking of buying a short sale property, foreclosure, or REO property, then it’s time to contact DeLena Ciamacco. Our team is here to answer all your questions and ensure you find the right home or property for your needs.

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