Prevent Foreclosures

We previously discussed briefly what a power of sale is. Let's recap it here.

What is a power of sale?

The deed of trust contains a power of sale clause while a mortgage usually does not. However, there are some exceptions. Unlike a mortgage, a deed of trust with a power of sale clause grants the beneficiary (the lender) the right to request the trustee (third party) to sell the property (your home) without having to file a lawsuit. That means, the lender can very easy sell your home and the homeowner will have very little say on the matter.

How come my lenders uses a mortgage but also has a power of sale clause?

Some states allow lenders to use a mortgage with a power of sale clause attached. Examples of states that allow both types of foreclosure are:

• Maryland
• Massachusetts
• Minnesota
• Mississippi
• New Hampshire
• North Carolina
• Oklahoma
• Rhode Island,
• Virginia

You need to look into the laws of each state carefully for more specific information on the type of foreclosure process allowed in that state.

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