You own a home and fall behind in your mortgage payments, and suddenly you are faced with being served with a summons and complaint, along with other notices, in which the lending institution is seeking to proceed with a foreclosure of your property. What do you do after receiving all of these papers?

Upon being served with such papers, it is crucial to review these papers, understand your rights and/or to consult with an attorney, especially prior to the entry of any defaults and prior to any judgments entering by the Court. The defendants in the foreclosure action should file a Notice of Appearance or hire counsel who would appear on the parties’ behalf, in an effort to prevent the entry of a default for failing to appear in the action, and also to receive all notices about the case.  Additionally, you would want to explore whether you qualify for the Foreclosure Mediation Program, which would be an avenue to determine if there is the potential for a loan modification and/or any other programs available which could assist you in saving your home.  The purpose of the foreclosure mediation program is to assist homeowners and lenders in achieving a mutually agreeable resolution to a foreclosure action.  It is important to note that the foreclosure mediation certificate form should be filed no later than 15 days from the return date contained on the summons page.  The Courts will sometimes permit the parties to file late requests for mediation, however, the best practice is to file the request for the foreclosure mediation within the specified timeframe.  If you are unable to qualify for the foreclosure mediation program, then you would still need to appear in the foreclosure action and defend the action, and should consult with an attorney in an effort to adequately protect your rights and to determine whether any defenses or counterclaims to the foreclosure action may exist.  Should a default enter for failing to plead, then the lending institution will proceed with moving ahead toward judgment.  Once the lending institution has obtained the necessary defaults, it would file a motion for judgment of foreclosure by sale and/or a motion for judgment of strict foreclosure, depending upon whether there is equity in the home.  If the home has sufficient equity, or if the United States of America is a named party in the action, then the lending institution would proceed by way of a motion for judgment of foreclosure by sale, and the Court would set a date for the auction sale.  If the home lacks equity, then the lending institution would proceed by way of a judgment of strict foreclosure, wherein the Court would set a specific law day within which the homeowner could redeem the property prior to title passing.  A homeowner should also be aware that the lender could file a motion for deficiency judgment as part of the foreclosure action.

Any action taken by the homeowner should be done as soon as possible upon being placed on notice of the foreclosure action, as it is much easier to defend the action prior to any judgments entering against you. The foreclosure mediation program can be very helpful in assisting homeowners in saving their homes, and is definitely an avenue that should be explored if the homeowner qualifies for the program.  The worst thing a homeowner can do is take no action upon being placed on notice of the foreclosure action, as this will inevitably result in a judgment entering against you.  Understanding your rights and seeking legal counsel can benefit you in working toward saving your home in the unfortunate event of being faced with a foreclosure action.

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