Foreclosures have been a hot topic in the news lately. We have all heard the stories about homeowners who have Adjustable Rate Mortgages (ARMs) and are now unable to cope with the pending increases in their monthly mortgage payments. In many parts of the nation the number of foreclosures has risen sharply in the past year. The Austin market has been mildly affected by this. Foreclosures are actually down in Austin, but they are up in Round Rock (a suburb city north of Austin.)
Many people have asked about the process of a foreclosure. It starts when a borrower is unable to make payments on his mortgage loan to the lending institution or bank. The lender then files a notice of public default. The foreclosure process allows the lender to obtain the remainder of the loan by either selling or repossessing the property which is covered by the mortgage.
When the borrower misses the first mortgage payment, the time line proceeds as follows after the 15 day grace period passes:
- Day 16 to day 30: The bank adds a late charge to the mortgage payment and an attempt is made to contact the borrower to find out why the payment has not been made.
- Day 45 to day 60: If the borrower still has not made the payment, a demand letter is sent from the bank to advise the borrower that the mortgage terms have been violated. The problem may be remedied if the borrower makes the delinquent payment within 30 days.
- Day 90 to day 105: At this point, the lending institution will refer the delinquent loan to its foreclosure department and will engage an attorney to begin foreclosure proceedings.
If you are looking to sell your home or refinance your mortgage please contact us – we are ready to assist! If you are looking to buy we can also help you locate the best foreclosure deals in Austin. 1-800-790-7910