Steps of Foreclosure - Walking You Through the Steps of Foreclosure

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There are six steps of foreclosure.
They start with you missing a mortgage payment or two and end with you losing your house.
In between, there are several opportunities for you to save your home.
What are the steps of foreclosure? Steps of Foreclosure 1: You fall behind on your payments.
Unless this is a case of wrongful foreclosure, the reason you are in your predicament is because you haven't paid one or more of your mortgage payments.
That's not uncommon.
Sometimes people miss payments due to illness, loss of a job, family emergencies, and other "normal life events.
" But increasingly, people are missing payments because adjustable rate mortgages and introductory teaser rate mortgages are resetting.
70 percent of foreclosures in 2008 are expected to be in this category.
Steps of Foreclosure 2: You receive a Notice of Default The Notice of Default is the lender's way of saying "you're behind" in a way that starts the legal process.
The Notice of Default also gives you an opportunity to repair the damage.
Steps of Foreclosure 3: Opportunity to Cure the Debt You have between 45-180 days to cure the debt depending on your state.
You have several options here.
You can renegotiate the terms of the loan with the bank, you can sell the house, you can make good on the debt, you can turn the house over to the bank, or you can walk away.
Steps of Foreclosure 4: Foreclosure Foreclosure is the legal proceeding whereby the bank formally takes possession of the bank.
Some states have a Judicial action while others are non-judicial states.
Steps of Foreclosure 5: Sheriff's Sale When the house is foreclosed, it is sold at a Sheriff's Sale.
While anyone can bid on the house, generally the bank buys the house for $1 over the deficiency.
Steps of Foreclosure 6: Redemption Period If you are able to come up with the money to cover the amount the house was sold for at the sheriff's sale, you have a short period of time after the auction to do so.
This is known as the Redemption period.

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