The Bank Won’t Foreclose I Am Not Paying My Mortgage

The Bank Won’t Foreclose I Am Not Paying My Mortgage

Sometimes, lenders decide not to foreclose on homes that have delinquent home loan mortgages that are in default.  For example, Joe has a mortgage for $200,000 on his home.  His monthly payment is $1000.  $200 is escrowed each month for taxes and insurance.  Joe has not paid his mortgage payment for 6 months.  Joe is $7200 behind in his mortgage.  Ordinarily, the lender would being foreclosure proceedings beginning in the fourth month of non-payment.  Nine months later, the lender would have an order for possession and the foreclosure sheriff’s sale of the home would be confirmed and complete.

However, sometimes, a lender doesn’t want the property back.  The following are the most common reasons:
1)  The property will not be easily resold
2)  The property is occupied and is not being vandalized.
3)  The lender has documentation problems and needs to wait until they have been able to correct documentation problems.

Let’s say that you simply want it “all over”.  Then you have a problem.  Even though you are behind in the mortgage, you are still the owner and liable for any building code violations or other violations such as leaving a vacant building.  In most cases, you are best off living in the property until the lender asks you to leave.

The benefits of staying in your home:  1)  Time to save up funds to get a rental unit  2)  Time to save up funds to pay off any deficiency judgment or pay for a bankruptcy  3)  Ability to allow your family to remain in the home longer to allow children to finish high school or simply enjoy their home, family and neighbors.

Why do people hate staying in their homes?  They are anxious about the foreclosure knowing that inevitably they will be thrown out of their home.  Another reason – they just want to get away from the bad experience of owning the home and losing it due to default.  Here’s the problem – the painful staying in the home is often best financially.  Although avoiding a bankruptcy may not be possible, avoiding the financial destruction of your family is by maximizing the amount of benefit you can get from staying in the home.

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