Question : Indiana: What is the difference between defaulting and foreclosure on a mortage?
Curious as to the difference between defaulting and foreclosure on a mortage? What are the different things that could happen if you keep one house and need to get rid of another wheather it be defautling or foreclosure? What are both possible outcomes?
- asked by Paul H
All Answers:
Answer #1
defaulting is not paying for your mortgage,foreclosure is the process by which the bank gainsownership of the property through the court systemfrom someone who has defaulted.
- answered by rhgizmo
Answer #2
defaulting means you didn't pay (so they'replanning to take action against you).foreclosureis the act of the bank or mortgage company takingback the homeAre you saying you own two homes withthe mortgage company? Well if you didn't pay onjust one then that one is the one the mortgagecompany will foreclose on.(I don't reallyunderstand your question, we need more info)
- answered by sophieb
Answer #3
Defaulting is not making your mortgage payments;foreclosure is the process the lender takes toreclaim your home because you did not make yourmortgage payments. If you have 2 homes and keepone, but lose the other because you did not keepmaking the mortgage payments on it and the lenderforeclosed on it and took it back, the lendercould place a lien on your existing home forwhatever money they are owed but did not receivefrom the sale of the foreclosed home. (say you owe400k on the home and it sells for 350k at theauction; you still owe the lender 50k) Generally,if you miss 3 payments you are sent a lettercalled a Notice of Default, which warns you thatforeclosure proceedings will begin immediateley (aNotice will be recorded) if you don't contact themand make those payments. In CA, it takes 3 monthsafter a Notice is recorded with the county for asale of the house to begin; a notice is preparedand published in the local newspaper. it takesfrom that point another 3 weeks before the houseactually goes to auction. When this happens andsomeone buys the place, that's it. You are out.The local sheriffs will physically remove you andyour property if they have to, and bill you forit. You credit is affected for 7 years or longer.Hope you don't take this route. Your best bet isto talk to the lender and see if they can help byputiing you into a more affordable loan. Remember,they would rather see you keep the home than takeit back. Hope this helps :)
- answered by J k
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