Generally, a foreclosure is the scenario that happens when the homeowner does not repay the mortgage. In fact, it is a legal process where the owner forfeits all the right to the mortgaged property. However, Foreclosure sales Virginia happens when the homeowner fails to pay the outstanding debt or else sell the property through short sale. As a result, the property goes to auction, and if the property does not sell at auction, the lender takes possession of the property.
Normally, if a lender loans some money without a collateral such as in the case of credit card, the lender can only take you to court for failure to pay. However, it can be hard to collect the money from the borrower. However, they usually sell such debts to collection agencies and write off the loss. Such debts taken without a collateral are considered unsecured.
In the case of secured credits, the situation is different. Even though the lender may suffer some losses in the event of a default, larger portions of such debts could be reclaimed by taking and disposing any property that was used as the loan collateral. Foreclosures, in this case may happen because a property is placed as security to the mortgage. Nonetheless, foreclosures go through several phases in Virginia.
The first stage is when the homeowner misses payments. It begins when the borrower fails to make the mortgage payment on time. That may be due to various hardships such as divorce, unemployment, medical challenges or death. However, when faced by such a situation, it is essential you talk the lender immediately. In some cases, the borrower may intentionally stop paying the loan since the mortgage is higher than the value of the property.
The second phase in a foreclosure is when the lender provides a public notice. When the borrower has missed the payments for 3-6 months, a public notice is given by the lender to the county office. The notice states that the borrower has defaulted the mortgage. The notice is intended to alert the homeowner of the danger of losing the rights to the property, and that he could as be evicted from that property. Depending on the state, a lender can post the notice at the door of the property.
The third phase is referred to as pre-foreclosure. This is where borrowers are given some grace period of between one to four months depending on regulations in the area. At this stage, borrowers may make arrangements with lenders regarding repaying outstanding amount or arranging for short sales. When borrowers pass their debt under such arrangements the process then ends.
The fourth phase is auctioning a property if the borrower have not found a remedy by the set deadline. As a result, a date is set by the lender or the representative of the lender for a property to be sold at an auction. At this point, the home is sold to the one who make the highest bid for a cash payment.
Finally, if the property is not bought by a third party at the auction, it enters the post-foreclosure phase where a lender takes the ownership of the home. However, bank owned properties may be sold on the open market by the local real estate agents or through a liquidation auction.
Normally, if a lender loans some money without a collateral such as in the case of credit card, the lender can only take you to court for failure to pay. However, it can be hard to collect the money from the borrower. However, they usually sell such debts to collection agencies and write off the loss. Such debts taken without a collateral are considered unsecured.
In the case of secured credits, the situation is different. Even though the lender may suffer some losses in the event of a default, larger portions of such debts could be reclaimed by taking and disposing any property that was used as the loan collateral. Foreclosures, in this case may happen because a property is placed as security to the mortgage. Nonetheless, foreclosures go through several phases in Virginia.
The first stage is when the homeowner misses payments. It begins when the borrower fails to make the mortgage payment on time. That may be due to various hardships such as divorce, unemployment, medical challenges or death. However, when faced by such a situation, it is essential you talk the lender immediately. In some cases, the borrower may intentionally stop paying the loan since the mortgage is higher than the value of the property.
The second phase in a foreclosure is when the lender provides a public notice. When the borrower has missed the payments for 3-6 months, a public notice is given by the lender to the county office. The notice states that the borrower has defaulted the mortgage. The notice is intended to alert the homeowner of the danger of losing the rights to the property, and that he could as be evicted from that property. Depending on the state, a lender can post the notice at the door of the property.
The third phase is referred to as pre-foreclosure. This is where borrowers are given some grace period of between one to four months depending on regulations in the area. At this stage, borrowers may make arrangements with lenders regarding repaying outstanding amount or arranging for short sales. When borrowers pass their debt under such arrangements the process then ends.
The fourth phase is auctioning a property if the borrower have not found a remedy by the set deadline. As a result, a date is set by the lender or the representative of the lender for a property to be sold at an auction. At this point, the home is sold to the one who make the highest bid for a cash payment.
Finally, if the property is not bought by a third party at the auction, it enters the post-foreclosure phase where a lender takes the ownership of the home. However, bank owned properties may be sold on the open market by the local real estate agents or through a liquidation auction.
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