Posted on: 29 January 2019
Every homeowner faces the possibility of foreclosure when they are in serious financial difficulties and are unable to meet their mortgage obligations. You are not obligated to simply meekly accept the foreclosure process, however. Using the legal system to fight the foreclosure is also an option. The following article examines some of the key considerations involved when decide to contest a foreclosure.
Judicial vs. Nonjudicial
A critical point concerning home foreclosure and the law is whether the foreclosure is judicial or non-judicial. Some states have judicial foreclosures where the mortgage holder must file suit against you in court to start the foreclosure process. Other states have non-judicial foreclosures where the lender may simply inform you that you have defaulted and they plan to auction off the house.
In a state where judicial foreclosure is the norm, you will have the opportunity to fight the foreclosure in court if you so choose. In states where nonjudicial foreclosures are the rule, you may need to file a lawsuit against the lender to have your day in court. In either instance, you will need the services of an experienced foreclosure attorney to help you navigate through the complexities of the process.
Although most homeowners consider filing for bankruptcy as a last resort to solve their financial problems, it might be a reasonable option if you are facing the loss of your home. For example, if you file for chapter 7 bankruptcy, it could take several months for the bankruptcy to work its way through the legal system. During that time, the foreclosure cannot proceed unless the lender gets a special exemption from the court. Homeowners can use this time to delay the foreclosure process and attempt to resolve the foreclosure through negotiation with the lender, borrowing money to pay the arrearage, or challenging the foreclosure in court.
Another bankruptcy option is to file for chapter 13. This type of bankruptcy allows you to pay the arrearage over time, typically three or five years. If the bankruptcy court accepts your plan to pay what you owe in this timeframe, you are protected from having your home taken by the mortgage holder.
To successfully challenge a foreclosure in court, you will need a good defense as to why the process should not proceed. For instance, in many states, the mortgage holder must take specific steps for the foreclosure to be valid. If they skip any of these steps, you may be able to convince a judge that the foreclosure process should be halted.
Other defenses that can stop foreclosure include showing that the lender made mistakes in their accounting process and did not credit you with payments you made or that the lender is unable to prove that they are they legitimate holder of the mortgage.
For more information about fighting foreclosures, contact foreclosure attorneys like James Alan Poe, P.A.Share