Massachusetts Foreclosure Process
There are two ways a lender can forelcose on your property. One is entry and possession but is very rarely used in Massachusetts so I will not cover this type of foreclosure. The second is the Non-Judicial process, which is what we typically see in Massachusetts.
The Non- Judicial foreclosure process takes advantage of the power of sale clause in your mortgage. When you sign your mortgage at the closing table there is language in the mortgage, stating that you "pre-authorize" the bank to sell you home to pay off the balance of your note if you are in default. There is a process the bank must go through to foreclose on your property.
The first step is the bank must notify you that you are in default on your mortgage. In most cases the bank will send out the notice with-in 30 to 90 days of non payment. There is no set time and can vary from bank to bank. The notice of default takes advantage of the acceleration clause in your mortgage requiring you pay the balance of your mortgage in full once you have missed a mortgage payment. The bank must give you 90 days to cure the note. Meaning, you have 90 days to bring your mortgage current and re-instate the mortgage for the previous terms.
Furthermore after the 90 days are up the lender must obtain a ruling from Massachusetts Land Court that the homeowner is not a service member in active duty under the Service Members’ Civil Relief Act of 2003. The homeowner has 30 days from the Order of Notice to dispute the foreclosure if they are in the armed forces.
After the 30 days are up the lender can now foreclose in as little as 30 days. The lender needs to notify the hom e owner by registered or certified mail of the upcoming auction date with at least 30 days notice. There also is a series of ads that need to be run for a minimum of three weeks to carry through with the auction. From there the auction takes place and is sold to the highest bidder.
In the non-judicial process you do not have a right of redemption.
You Have Time
The thing to remember is you do have several months before losing your home to a foreclosure auction. It is important to be pro-active and expedient once you get the notice of default from your lender. You have options to foreclosure and it is usually far more beneficially to excersize another option rather than letting the bank foreclose on your property. Some of those options are:
- Loan Modification
- Loan Forebearance
- Bankruptcy
- Deed in Lieu of Foreclosure
- Short Sale
Don't let the bank take your home explore other options to foreclosure.
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This post was provided by Kevin Vitali of EXIT Group One Real Estate In Tewksbury MA. You can contact Kevin by email at kevin@kevinvitali.com or call 978-360-0422. Visit www.thehousewiz.com for more information on buying or selling real estate.
I have been handling short sales for several years now and can explain your options and help you decide what options are right for you. If a short sale is the right option, I can list your property as a short sale and help obtain the best results possible.
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