Are You at Risk for Foreclosure?

Too many hard-working families and homeowners in the State of Tennessee fear losing their homes to foreclosure. In the Kingston area, if your home is at risk for foreclosure, arrange at once to discuss your concerns, rights, and options with a .

If you’ve lost your job, if you have suffered a serious illness or injury, or if you are behind on your mortgage payments for some other reason, you may have questions: How much notice will you have before a foreclosure begins? Can you catch up on payments to stop the foreclosure?

How does the foreclosure process work in Tennessee, and what options does a homeowner have for fighting foreclosure? When should a homeowner contact a ? Keep reading this brief discussion of foreclosure and your rights in Tennessee for the answers.

How Does the Foreclosure Process Work?

Defaulting on your mortgage triggers serious problems. Most mortgages authorize lenders to retake control of a property if the payments are not made. Lenders may begin the foreclosure process after one late payment, but they generally wait until someone misses several payments.

Tennessee is a “nonjudicial” foreclosure state. This means that no legal proceeding is required in order to foreclose on your home. There won’t be any foreclosure lawsuit or any hearings. In most Tennessee foreclosures, a homeowner has no opportunity to argue his or her case before a judge.

What Does the Law Require?

In most cases, federal law requires a mortgage lender to wait until a loan is 120 days delinquent before initiating the foreclosure process. In Tennessee, a borrower must be notified at least sixty days in advance that a lender intends to foreclose on a home.

That notice may give you a final opportunity to catch up on your mortgage payments, and it gives you time to meet with and discuss your options with a foreclosure attorney.

Subsequently, a homeowner will be notified when a lender has initiated the foreclosure process. If you do not take action to prevent a foreclosure (by filing for bankruptcy, for example), your home could be sold, and if necessary, the lender could even take legal action to have you evicted.

What Are a Homeowner’s Rights?

Federal and state laws offer some basic legal protections to Tennessee homeowners who may be facing foreclosure. When it forecloses a property, a mortgage lender in this state must adhere to a number of strict legal guidelines during each step of the process.

Along with the protections that state and federal law provide, most mortgage borrowers in Tennessee also have contractual rights. Your deed of trust and your promissory note give you the legal right to:

  1. receive a notice of foreclosure
  2. apply for loss mitigation or loan modification
  3. catch up on mortgage payments and prevent the sale of the home
  4. file for bankruptcy
  5. receive additional legal protection if you are serving in the military
  6. seek assistance from the Tennessee Housing Development Agency

Communication is the Key

A homeowner can prevent a foreclosure in several ways, but the key to preventing foreclosure is acting early – getting in front of any potential problems – and communicating clearly with the mortgage lender. Be pro-active, and don’t wait for your mortgage lender to take the first step.

Like homeowners, mortgage lenders prefer to avoid foreclosures. Before you miss a mortgage payment, reach out to the lender and communicate your financial troubles. Most lenders are willing to provide you with some options when you’re struggling to make mortgage payments.

Keep a precise record of every communication you have with the mortgage lender. Write down the details, date, and time of your phone conversations, and the name of the person you speak with. Keep records and make copies of any mail that is exchanged between you and the lender.

What Are a Homeowner’s Options for Stopping Foreclosure?

If you anticipate receiving a notice of foreclosure, investigate all of your options for avoiding a foreclosure. Some homeowners in this state may be eligible for assistance through the if they meet the guidelines and requirements for assistance.

The law does not require a mortgage lender to offer a loss mitigation program, but many lenders offer loss mitigation because preventing foreclosures reduces their own losses. A common option for loss mitigation is a mortgage loan modification that revises the terms of the original loan.

A short sale is another way to stop a foreclosure. A short sale happens when a homeowner sells a property for an amount that is substantially less than what is still owed to the mortgage lender. A homeowner loses the home either way but avoids a foreclosure on his or her credit report.

When a short sale or a foreclosure sale doesn’t pay the full amount owed on a mortgage, the difference between the sale price and the total debt is called a “deficiency balance,” and Tennessee allows a lender to go to court to obtain a deficiency judgment against the borrower for this amount.

Should You Consider the Bankruptcy Option?

Bankruptcy instantly stops a foreclosure process from moving forward. When you file bankruptcy papers, the bankruptcy court issues an automatic stay that orders creditors, including mortgage lenders, to cease any legal proceedings or other collection efforts targeting you.

Bankruptcy, however, entails serious negative consequences – you could lose most of your assets, for example – and it is genuinely the option of last resort, although for some homeowners who face foreclosure in Tennessee, bankruptcy may be their only remaining practical option.

How Will a Foreclosure Attorney Assist You?

If your Tennessee mortgage lender is about to begin the foreclosure process, you must arrange immediately to meet with a Kingston foreclosure attorney to discuss your rights as a borrower and your options for dealing with foreclosure.

After your lawyer reviews your mortgage and your financial circumstances, he or she will suggest your most appropriate options for moving forward constructively. You’ll get personalized legal advice to help you choose a short sale, a bankruptcy, or another option for dealing with your foreclosure.

If a foreclosure can be avoided, your lawyer will show you how, but the longer you delay, the fewer options will remain open to you. If a foreclosure on your home is imminent, contact the offices of a Kingston foreclosure lawyer and schedule a no-obligation case evaluation at once.