foreclosure

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Foreclosure

A procedure by which the holder of a mortgage—an interest in land providing security for the performance of a duty or the payment of a debt—sells the property upon the failure of the debtor to pay the mortgage debt and, thereby, terminates his or her rights in the property.

Statutory foreclosure is foreclosure by performance of a power of sale clause in the mortgage without need for court action, since the foreclosure must be done in accordance with the statutory provisions governing such sales.

Strict foreclosure refers to the procedure pursuant to which the court ascertains the amount due under the mortgage; orders its payment within a certain limited time; and prescribes that in default of such payment a debtor will permanently lose his or her equity of redemption, the right to recover the property upon payment of the debt, interest, and costs. The title of the property is conveyed absolutely to the creditor, on default in payment, without any sale of the property.

foreclosure

n. the system by which a party who has loaned money secured by a mortgage or deed of trust on real property (or has an unpaid judgment), requires sale of the real property to recover the money due, unpaid interest, plus the costs of foreclosure, when the debtor fails to make payment. After the payments on the promissory note (which is evidence of the loan) have become delinquent for several months (time varies from state to state), the lender can have a notice of default served on the debtor (borrower) stating the amount due and the amount necessary to "cure" the default. If the delinquency and costs of foreclosure are not paid within a specified period, then the lender (or the trustee in states using deeds of trust) will set a foreclosure date, after which the property may be sold at public sale. Up to the time of foreclosure (or even afterwards in some states) the defaulting borrower can pay all delinquencies and costs (which are then greater due to foreclosure costs) and "redeem" the property. Upon sale of the property the amount due is paid to the creditor (lender or owner of the judgment) and the remainder of the money received from the sale, if any, is paid to the lender. There is also judicial foreclosure in which the lender can bring suit for foreclosure against the defaulting borrower for the delinquency and force a sale. This is used in several states with the mortgage system or in deed of trust states when it appears that the amount due is greater than the equity value of the real property, and the lender wishes to get a deficiency judgment for the amount still due after sale. This is not necessary in those states which give deficiency judgments without filing a lawsuit when the foreclosure is upon the mortgage or deed of trust. (See: mortgage, deed of trust, forced sale, execution, notice of default)

foreclosure

the right to take mortgaged property in satisfaction of the amount due. Where a mortgagor has defaulted on his obligations under the terms of the mortgage, the mortgagee has a number of powers available to him to protect his investment. One of these is the power to foreclose. Foreclosure can be effected only by an order of the court that involves, first, the granting of an order of foreclosure nisi, which effectively gives the mortgagor six months' grace within which to raise the sums due; if the mortgagor has failed to do this, the foreclosure becomes absolute, whereupon the rights of the mortgagor in the property cease and become vested in the mortgagee.

Ask a Lawyer

Question

Country: United States of America
State: Florida

We have an upcoming date concerning foreclosure on our home during which they are going to set a sale date. We need to delay this first meeting by a week so we can get a payoff figure from the mortgage company. Is there any way to file paperwork or reasons that we can file a motion that will help buy us some time?

Answer

It is difficult to do unless the parties agree...you can say you are unavailable for some serious reason etc.
References in periodicals archive ?
So goes the long slog through the stockpile of foreclosed homes in Worcester, a place where distressed homes can sell for the same price as a luxury SUV.
It has spent more than $1 billion since the beginning of this year to acquire more than 6,500 foreclosed houses in eight major metro areas.
The new asset management firm will focus on acquiring foreclosed homes across the United States to rent them out.
Showhomes of Madison is working with bankers and asset managers to help them preserve foreclosed listings, minimize costs, reduce insurance exposure and sell homes for higher prices.
In the third quarter, we started to at least see an increase in the number of foreclosed hotels reselling to new buyers.
Once a foreclosure court has spoken and ruled a property foreclosed, John said, and that property is sold, the buyer of that property is generally held harmless.
The city of Manchester was awarded $7.74 million, the most in the state, and will sub-grant portions to other organizations to redevelop foreclosed, vacant or abandoned properties in West Granite, Corey Square and the Hollow neighborhoods.
And while there is a cost-of-carry associated with these foreclosed properties, MBTC has typically been able to sell these foreclosed properties at a profit.
REO RESQ business services include inspection, security, emergency repairs, maintenance and repair services on foreclosed properties so the owners can get the properties back into market value condition.
They treat the difference between the value of the foreclosed property and the taxpayer's basis as a sale and the difference between the forgiven debt and the value of the property as forgiveness-of-indebtedness income.
The court was particularly impressed by the size of the difference in the tax consequences to the estate ($3.27 million) and the debtor ($13 million) if all three properties had been foreclosed.
As a consequence, Metrobank foreclosed one of the mortgages but the insolvency court refused to issue the certificate of sale in favor of the buyer because of its July 12, 2005 order.