What Happens When You Face Foreclosure?

For many people who face foreclosure, it can seem like an overwhelming experience. Not only are you faced with the stress that comes from potentially losing your home, but you are also faced with the possibility of a prolonged legal process. But what actually does that process look like in New York, and how should you handle it when you face foreclosure?

Step One: Notice From Your Mortgage Lender

    The first step in foreclosure comes when you receive notice from your mortgage lender that you are behind on mortgage payments. This first notice is less of a formal beginning of the foreclosure process, and more of a warning that you need to repay what you owe or foreclosure could be in your future. If the issues with the mortgage are not cured within 90 days, or after three missed mortgage payments, the mortgage lender will issue a notice of default (also known as an acceleration letter), and you will be issued a summons and complaint notifying you of the foreclosure.

Step Two: Conference for Settlement

    At this point, you and your mortgage lender will meet, typically with lawyers present for both sides. This is where you can attempt to negotiate for some kind of settlement that does not involve foreclosing on your home, such as mortgage modification or coming up with an alternative payment structure that may be more manageable for you. Many foreclosures end at this point, settled out of court before the foreclosure can progress, allowing for loss mitigation rather than the total loss of your home.

Step Three: Trial and Judgment

    If you and your mortgage lender fail to come to an agreement to settle the case, it will proceed to trial and judgment. This entire process can take quite a long time, however, as there are often numerous motions that need to be filed, and until the trial takes place, you can still attempt to settle the case. Once it goes to trial, however, all that awaits is the court’s judgment about whether your home will be foreclosed on or not.

Step Four: Auction and Eviction

    If the court rules against you, the foreclosure will proceed and your home will be put up for auction. It will be sold to the highest bidder, and you will be forced to find somewhere else to live. While this may seem like an unfortunate inevitability, you can try to protect yourself from foreclosure by obtaining experienced legal counsel with knowledge of foreclosure law. The sooner you find a lawyer, the more effectively you can defend yourself from the worst case scenario.
    At David J. Lorber & Associates, PLLC, we assist clients throughout New York who are at risk of losing their homes to foreclosure. We will explain your options and guide you in making the best decision for your circumstances. Call us at (631) 750-0900 or contact us online to schedule your Free consultation at our Setauket office.