Understanding Foreclosures

As the foreclosure rate in this country continues to rise, understanding foreclosures is important whether you are falling behind on your mortgage loan or you are considering investing in real estate. For those who are facing foreclosure, it is important to understand the process and have an idea of the timeframe so that you have the best chance at saving your home. For investors, understanding foreclosures can lead to a profitable real estate investing career.

Foreclosure is the process a lender uses to gain ownership of a property that is the security for a mortgage that is not being paid as agreed. Depending on the state where the property is located, the lender may have to wait until payments are past due for a certain length of time before beginning the foreclosure process. In some states, all foreclosures are handled through the courts. In others, lenders who have a “deed of trust” or “trust deed” may be able to begin foreclosure without going through the courts.

Although the foreclosure process varies from one state to another, there is usually some sort of initial notice required to be given to the borrower prior to foreclosure. The borrower then has a certain amount of time to bring the loan current. If he fails to do so, the lender can continue with the foreclosure process.

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