The first letter you get from the bank will likely come after your first missed payment, or maybe your second. This is the bank’s good-faith effort to allow you to take care of the situation without any unpleasantness. A couple months later, though, you’ll get a letter from the bank asking for the balance in full. Even at this point, with many lenders you can still get a modification worked out, but it’s best to talk to the bank before you get this letter.

This second letter will have a deadline on it, and if you haven’t taken care of the situation, the bank will talk to a lawyer to begin the foreclosure process. At this point, it’s more difficult to go back to a monthly payment plan, as the bank has put legal fees into the situation. Now, you’ll want to talk to a private lender or go through some other channel to pay the loan for you, and then you would start paying the new creditor, if you can’t sell the house.

The lawyer will send you a third letter, again demanding payment in full before a particular date. After that, the lawyer files a foreclosure petition with the court. You’ll get a copy, as will everyone else (tenants, other mortgage holders, lienholders and so on). About a month after that document comes, you’ll go to court, and the judge gives the lender an “order nisi” that starts the redemption period. This gives you about six months to pay all that you owe, in addition to interest, taxes and costs. The lender may ask for a shorter period, but six months is generally the standard. After this time elapses, the lender can have the court list the property for sale or get a foreclosure order.

As you can see, this process can drag on for more than a year. However, Amansad Financial has connections with lenders who can find alternatives to foreclosure. Get in touch with us today or see if you qualify now through our fast Pre-Qualification form.

The truth is that foreclosure is not this quick. If you let your bank know ahead of time that you will be late on a payment (as well as the reason why), then even the most aggressive lender is likely to work with you. After all, banks don’t like sending borrowers to foreclosure. First of all, they end up losing the revenue of the monthly payments. Then, they have the legal expenses that are associated with going to court for foreclosure. Finally, they often have to spend a good deal of money bringing the house back into a salable condition, or they have to discount the sale price well below the principal on the associated loan because of the damage that the evicted residents have inflicted on the interior. Foreclosure is not an option that makes much financial sense for the banks, which is why the process takes a long time. Some lenders will file proceedings as early as two missed payments (or even late payments, with particularly aggressive lenders), while others will wait for three and even four payments, in the meantime trying to contact you via phone, email and letter to find a solution with you.

The very first step in the foreclosure process involves going to court to get an order against you that sets the date of the foreclosure sale. However, the month (or in some cases, months) between the order and the date of the sale is known as the redemption period. It is at this time that you have the chance to redeem, or reverse mortgage foreclosure. It will still appear on your credit report, but instead of taking as many as 300 points off your score (which a completed foreclosure does), if you can redeem it, the foreclosure will hurt your credit significantly less.

So how do you redeem or reverse a foreclosure? Banks have to allow you to redeem it if you come up with the full amount of the principal owed, as well as interest and fees, before the foreclosure sale is set to take place. Some banks will allow you to redeem it if you can simply bring the loan current, or perhaps get ahead a payment or two. The law requires banks to permit redemption with the full amount, but some lender policies also allow redemption just for coming current. Of course, if you are able to redeem it for less than the full principal, then you still face some hurdles when your loan comes up for renewal, as your credit score will be significantly lower than it was, unless you have more than seven years (the amount of time a foreclosure stays on your credit report) remaining before the renewal of your loan. However, redemption is much better than foreclosure, as you get to remain in your home as the owner.

Amansad Financial has helped many clients who are in this position, though, so you are not alone. One of the most frequent ways in which we help clients avoid foreclosure involves the use of private lenders. These are individuals or companies that have capital to invest and are looking for ways that are not as risky as purchasing stocks or investing in futures. They don’t want to settle for the rock bottom interest rates that come from passbook savings accounts either, though, and private lending yields higher rates of interest than the banks get on their mortgages (you do, after all, represent a higher level of risk).

If you are finding yourself at risk of entering foreclosure, the best thing you can do today is call your bank and start finding a way to work things out without going to court. If you can avoid having that foreclosure on your credit report, you will be much better off over time. However, if the filing has already taken place, Amansad Financial can still help. Give one of our foreclosure reversal experts a call today.