Below you will find a collection of frequently asked questions that pertain to foreclosure elements:

Q: What is foreclosure?

A: Foreclosure is a specific legal process in which a lender attempts to recover the balance of a loan from a borrower who has stopped making payments to the lender by forcing the sale of the asset used as the collateral for the loan.

Q: Will a bank or lender negotiate my interest rates and principal so that I can avoid foreclosure on my home?

A: Lenders may agree to a loan modification when you have an adjustable interest rate, and if you find yourself months behind on your payments they may adjust your adjustable interest to a fixed interest rate along with multiple other modification options. In general, lenders are willing to negotiate on loan modifications if there is a chance that you can successfully repay your loans in part or in full versus the lengthy and costly process of foreclosure.

Q: If I am in the process of filing for bankruptcy can the bank or my lender foreclose on my home?

A: In general, the process of bankruptcy can delay a foreclosure but will not permanently halt it from happening. Upon filing for bankruptcy, the court issues an “Automatic Stay” which informs creditors to cease and desist all collection efforts as well as foreclosure proceedings. With bankruptcy pending, the foreclosure of your home will be postponed. In filing for Chapter 7 bankruptcy, you are permitted to live in your home during the months leading up to bankruptcy finalization. You have the opportunity to use that money for a future living situation.

Q: What is a deed in lieu of foreclosure?

A: In terms of a deed in lieu of foreclosure, you forfeit the deed of your home to the lender in exchange for their cancelling your loan rather than foreclosing on your home or property. This is a voluntary agreement between lender and borrower and in general, deeds in lieu of foreclosure are not accepted on properties with second mortgages.

Q: Who are the key players involved in a foreclosure?

A: The borrower and the lender. The borrower is generally the property or homeowner borrowing money from a lender, placing the home itself as security on the loan. The lender offers the loan to the borrower.

Q: What are the general steps involved with the foreclosure process?

A: Depending on the state and jurisdiction, foreclosure can work in different ways but there are two recognized types of foreclosure: “Judicial Foreclosure” (requiring the lender to involve the court system to retrieve ownership of their property) and “Non-judicial Foreclosure” (the lender adheres to a foreclosure process that is specific to the state, with no court involvement).

Contact a Foreclosure Attorney Today

We are proud of the rock-solid reputation we have earned among our former clients and colleagues and look forward to providing you with high quality legal assistance as you deal with the possibility of Chapter 11 or 13 bankruptcy or foreclosure on your home. Please contact our offices located in Sherman Oaks and Los Angeles today to speak with one of our bilingual staff members and to start the process of financial recovery. As a Southern California debt relief agency, we are standing by to assist you. Call us at (213) 699-3055 today for a free consultation.