What is a Foreclosure Complaint?

A Foreclosure Complaint is usually a document several pages long that is filed with the court in the county where the property to be foreclosed on is located. The document alleges that the borrower willingly signed a mortgage and a promissory note that is now in default.

What is the purpose of the Foreclosure Complaint?

The purpose of the Foreclosure Complaint is to initiate a lawsuit against all party involved including:

• the owners of the property
• tenants (if any)
• lien holders

The Foreclosure Complaint outlines that the plaintiff sues the defendant(s) and alleges the action for the foreclosure of a mortgage on a specified property. The plaintiff is usually the owner and holder of the Note and Mortgage on the home.

What happens when the Foreclosure Complaint if filed?

The Foreclosure Complaint document and a court summons announcing the lawsuit will be served upon all of the defendants (i.e. all parties involved including owners, tenants, and lien holders)

How to answer a foreclosure complaint?

The Summons details what your options are in terms of answering the Foreclosure Complaint. The Summons explains that a lawsuit has been filed against you and you have a certain number of days, such as 30 days, to file a written response with the clerk of the court. If you want the court to hear your side of the story, you must file your foreclosure complaint answer with the court officially as directed in the Summons you receive. Do not call the court instead of filing a written answer.

What happens if you do not respond to a foreclosure complaint?

If you do not file a foreclosure complaint answer or you do not respond on time, then you will lose the case and you will be basically admitting the Foreclosure Complaint. If you lose, then your wages, money and property may thereafter be taken without further warning from the court.

If you need an attorney to help you, you need to contact one immediately. If you do not have an attorney, you can call an Attorney Referral Service or Legal Aid Office to help you. If you are filing a written response yourself, you need to file it with he court as well as mail a copy to the Plaintiff’s attorney whose contact information will be listed on your Foreclosure Summons.

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Should I just walk away?

Firstly, you should not think about walking away if there is a chance that you can save your home. There may be solutions that you are not aware of. Most homeowners do not know all the options available to them. But, the experts who deal with foreclosure situations daily may know and may be able to suggest something that can help you.

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If there is nothing that can be done, you can consider walking away from your home and your mortgage obligations. However, you need to be sure that the mortgage company (or companies) is not going to sue you later. It could be years before they decide to sue you. If you just have a first mortgage to worry about, then it might make sense to try to make sure that you are going to walk away free and clear and the mortgage company will not come after you. There are many homeowners that thought their problems were behind them until, after the foreclosure sale, they found out the hard way that the lenders had no been paid off and they wanted money from the homeowners still.

If the lender cannot sue you, then you probably have a non-recourse loan. You need to check with your state what the lenders can or cannot do. State laws vary from state to state.

Should I walk away if I have a second mortgage too?

Usually walking away will not get you free from the second mortgage debt and the second mortgage lender would likely come after you for the money you owe.

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What is Loan Modification?

Loan modification allows homeowners and lenders to change the terms of a loan in order to help the borrower stay in the home and avoid foreclosure. It is important to note that a loan modification is not a new mortgage. A loan modification is the renegotiation of an existing loan.

With a loan modification, it’s possible that a homeowner’s:

• interest rate may be decreased
• interest rate may be changed from an adjustable to a fixed rate
• time the borrower has to pay the loan back can be lengthened
• loan principal may be decreased
• late fees may be waived
• second mortgage could be waived or wiped off of the books

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Can loan modification prevent foreclosure

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Why is it difficult to work with mortgage companies to prevent foreclosure?

While all mortgage companies will say that they would work with you and help you however they can, in practice, they are there to gauge how much you can pay, negotiate higher payments than you can afford and send the rest to collection even without notifying you. Most mortgage companies have many departments dealing with people who are behind in payments. It is not uncommon for the person on the phone with you to say one thing and then you receive something else in the mail.

It is hard to talk to the person with authority at the mortgage company. Almost all mortgage companies will treat you as just another case they have to deal with and their objectives are to get as much out of you as possible and as fast as possible. If you are prepared to pay some parts of your mortgage payments, then they are likely to take it but then you are also likely to get a letter from their collection agencies.

How to work with mortgage companies to prevent foreclosure?

Before you contact your mortgage company and try to negotiate, you should find out about all your options. You can get a free foreclosure consultation or you can do a lot of research by yourself.

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Then you can prepare your hardship case that will include sending the mortgage company a hardship letter or several hardship letters to explain your situation. If you have talked to your mortgage company and have settled on a solution, you should get them to put your agreements in writing. Don’t
trust that things will go as planned until you see everything in writing.

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How to avoid foreclosure 101

Below are different ways to help you prevent and avoid foreclosure.

Catch up on your payments Even if you have received the notice of default and is already in the foreclosure process, you can still avoid foreclosure by catching up on your payments (mortgage payment, tax payments, etc). You may also need to pay fees associated with the foreclosure process to avoid foreclosure. But, unfortunately, for most people, catching up on payments is not an option to avoid foreclosure.

Sell your home to avoid foreclosure

Selling your home is a way to avoid foreclosure. If the real estate market is strong, you may be able to sell at a higher value than the amount you owe the mortgage company and pay off the loan. You will avoid foreclosure by paying off the loan. However if the real estate market is slow or weak, see short sale.

Let someone else take over your mortgage payments to avoid foreclosure

There are many real estate investors who are trained to profit by taking over mortgage payments of people in foreclosure. This may be a way for you to avoid foreclosure.

Rent your property to avoid foreclosure

Renting is a way of making fast money, providing your house is somewhere attractive to tenants. You may be able to obtain fast cash to catch up on your payments, therefore avoiding foreclosure.

Free Avoid Foreclosure Consultation

If you want more information about what you can do and learn all about your options, here is a link to a free consultation.

Prevent Foreclosure Today – Immediate Prevention. Most homes can be saved. Fast & Free Advice

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Definition of short sale foreclosure

When you owe the mortgage company more than your home is worth. (You can find out what your home is worth for free using the link on the right hand side.) Then even if you sell your home, you will not have enough money to pay off your mortgage balance. In this case, there is a solution and it
is called short sale or real estate short sale or foreclosure short sale.

What happens in a short sale foreclosure?

When a homeowner realizes that he or she is upside down on his or her mortgage, he or she can find a realtor or a real estate investor to help him/her with a short sale.

As your mortgage company is getting to foreclose on your home, you can have a real estate investor send them a short sale proposal letter. In the letter, the real estate investor will express his or her interest in buying your home to avoid foreclosure. By buying your home, he/she will save everyone from the headache of foreclosure.

Since you owe more than your home is worth, the real estate investor or realtor will convince the bank to accept less than the amount you owe for the property. For example, if your mortgage balance is $200,000 and your home is now worth only $150,000, you are “upside down” $50,000. If you contact the bank yourself and ask them to take $150,000 they are unlikely to listen.

However if you prove to them of your hardship, provide them with a willing buyer who is the one doing the short sale, and convince them that if they did not accept the short sale then they will have to file for foreclosure and sell your home in an auction which could be much less than the short sale price offered. If the short sale is done right and the real estate investor is experienced at doing short sale, then the bank is likely to accept less money than the actual amount that you owe.

What’s the best that can happen in a Short Sale?

In a successful short sale case, you walk away free and clear, the real estate investor buys the property and the bank settles. A realtor can usually find you a buyer who is willing to do a short sale with the bank.

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What to do about Bank Foreclosure Delays?

If your bank has not filed for foreclosure, then you should contact your bank and ask them for more time to catch up on your mortgage payments. This is an effective delay strategy especially early on when you just defaulted on your payments and the bank is just adding interests, fees, and penalties to your mortgage bills.

However, when you are many months behind, calling the bank and asking for more time will not help too much. If the bank is nice, they might extend a grace period further but most banks will start the foreclosure process.

If you want to make sure that you have explored all the options, you can get a free foreclosure consultation below. Many times, you won’t have to negotiate with your bank yourself especially if they are not cooperating, the foreclosure help service below can even negotiate with your bank to lower your interest payments.

Do not ignore the lender!

Some people think that by ignoring the lender, they are actually delaying foreclosure. While this may be true of some lenders (some lenders send your account to collection before starting the foreclosure process) that you don’t owe much money, more lenders would file foreclosure on your home faster if you ignore them.

Communication is key. The question is are you the one communicating? or is it better to have a professional communicate on your behalf. Sometimes you should communicate through a realtor or a real estate investor in the case of a short sale foreclosure, see What is the Definition of Short Sale Foreclosure.

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Reasons why you should prevent foreclosure or stop foreclosure (if foreclosure already happens)

Leave your home on your own terms instead of getting evicted

At the final stage of foreclosure, if you have not vacated your foreclosure property, you will be evicted. It is not pretty. We have seen many nice and respectable folks leaving their beloved home in a hurry in the middle of the night to avoid being seen by neighbors and sparing themselves of embarrassment. Getting evicted is by FAR worse than if you were to leave your home by yourself or even
selling your home in advance.

Get something for your home instead of getting nothing after foreclosure is complete

If you sell your home before your mortgage lender is done foreclosing on your house, you may get some values from your property. Nowadays, it does not matter how much you owe your mortgage lender. If you owe your mortgage lender MORE than your home is worth, real estate investors can help you negotiate with your mortgage lender in a process called ’short sales’. By doing so, you will be able to sell your home for what you owe on it to the real estate investors. This is particularly beneficial when you owe
more than you can sell your home for.

For example, if your home is worth $200,000 in the market right now and you owe your mortgage lender $250,000. You can only sell it for $200,000 or less if you try to list it on the market with a realtor. In order to sell your home fast, you may have to reduce the price to $180,000. You will also have to pay realtor’s fees and other costs. Let’s say, you will end up with about $170,000 net for your house.
Since you owe the mortgage lender $250,000, you will have to come up with $80,000 on the spot.

However, if you sell to real estate investors, they will negotiate with the bank to drop
off the remaining portion of your debt. That means, at the end of the day (subject to a successful short sale), you will no longer owe the bank anything. An investor will buy your house, help you find other housing arrangements if needed, set you up with some start up cash, and also help you clean up your credit so that
you can borrow again for your new home in the near future.

Avoid the embarrassment

Foreclosure is embarrassing. Notices of default are public notices – that means anyone reading the papers will know that you have defaulted on your mortgage payment and are now facing foreclosure. Imagine your friends and colleagues knowing how bad your financial situation is. Imagine your children’s friends and teachers at school knowing about your financial situation. Imagine your neighbors knowing. It is not pretty. We want to spare you all that embarrassment!

If the public notices aren’t bad enough. Imagine, you and your family having to pack up in a hurry and leave. Your neighbors may not be told that you are in foreclosure but THEY KNOW. Foreclosures have happened enough times in the United States for them to put two and two together and figure out that’s what’s happening to you.

If gossips, words of mouth and speculation aren’t bad enough, imagine one day someone (it could be the sheriff or a representative of the mortgage lender or the realtor in charge of foreclosure) coming to your house, stabbing a bright yellow piece of paper on your front door visible to anyone walking pass from a mile away. The notice on the bright yellow paper says, something along the line of, “contact the agent below to get some of your belongings”. Yes, you have been evicted. Sometimes, the representative is nice enough to not throw all your stuff out on the curb for everyone to see which is probably the most embarrassing thing that could happen to any homeowner. Other times, they would just throw your stuff out on the street as thrash. It is sad and not pretty. So, don’t let it happen to you! Find a reputable investor and prevent your foreclosure now!

Save your credit

Most of the time, a foreclosure stays on your credit report for seven years. In many cases, foreclosures are even worse than bankruptcies. But, both foreclosures and bankruptcies are bad for your credit and you really should avoid foreclosure and avoid bankruptcy if there are alternatives. Prevent Foreclosures offers alternatives so you should never have to go through with foreclosure (you can
stop foreclosure) and you should never have to file bankruptcy to get out of foreclosure.

Some expert credit repair programs claim that they can remove foreclosure from your credit report within a few months.

Is it true that credit repair programs can remove foreclosure from your credit report for good and you can borrow again soon?

As far as we have seen, yes, some people have foreclosure deleted from their credit after a few months. Others may take a year. It really depends on how bad the foreclosure is. You also have to be careful about which credit repair company you use to help you clean up your credit. Using the wrong credit repair company could be disastrous rather than helpful.

If you are ready to start preventing foreclosure and finding out more about your options, below is a free consultation that will help you.

Prevent Foreclosure Today – Immediate Prevention. Most homes can be saved. Fast & Free Advice

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