How Does a Foreclosure Work?
The foreclosure process varies from state to state. However, in most cases, if the borrower has missed 90+ days of payments, a Notice of Default is then placed on the home. The loan is then handed over to a foreclosure department and the default is officially public record. Typically, if the loan isn’t brought current within three months, a foreclosure date is established.
When a homeowner falls behind on their mortgage payments, this typically means they have been struggling for quite some time. This could also mean that in some cases, the home may be in general need of repair and maintenance. Be prepared to deal with leaky roofs, missing light bulbs, poor landscaping, cracked windows, broken appliances, etc. So while you may be getting a steep discount when buying foreclosures, it is most important to understand your total cost of repair before making any moves.
Understanding the Ohio Foreclosure Timeline
In order to forclose on a home in Ohio, a mortgage lender must file a foreclosure complaint with the county court. This gives homeowners an opportunity to save their homes by contesting the complaint. If your lender is attempting to foreclose on your home, you should immediately educate yourself about the process and seek the help of expert legal counsel. The timeline below explains how the process works but remember, not all lenders proceed in the same way and situations may evolve differently depending on individual circumstances.
TIPS FOR AVOIDING FORECLOSURE
Understand foreclosure prevention options
The further behind you become, the harder it will be to reinstate your loan and the more likely that you will lose your house.
Contact a HUD-approved housing counselor
The U.S. Department of Housing and Urban Development (HUD) funds free or very low-cost housing counseling nationwide. Housing counselors can help you understand the law and your options, organize your finances and represent you in negotiations with your lender, if you need this assistance.
Prioritize your spending
After healthcare, keeping your house should be your first priority. Review your finances and see where you can cut spending in order to make your mortgage payment. Look for optional expenses–cable TV, memberships, entertainment–that you can eliminate. Delay payments on credit cards and other “unsecured” debt until you have paid your mortgage.
Use your assets
Do you have assets–a second car, jewelry, a whole life insurance policy–that you can sell for cash to help reinstate your loan? Can anyone in your household get an extra job to bring in additional income? Even if these efforts don’t significantly increase your available cash or your income, they demonstrate to your lender that you are willing to make sacrifices to keep your home.