Individuals and families in New York who are facing financial challenges are usually looking for options: Can I increase my income? Can I trim my budget? Can I address my debt situation? The questions and answers are different for everyone, but one financial challenge can be scarier than the rest – the prospect of losing your home in a foreclosure action.
What are the most common questions when it comes to foreclosure? For New York residents facing this situation, there are many, but the most common is probably, “What is foreclosure”? In essence, a foreclosure action is a mortgage lender’s legal option to reclaim property when a borrower doesn’t comply with the mortgage agreement. In the most common scenario, a homeowner becomes delinquent on monthly mortgage payments, or can’t pay at all. The family home is the collateral for that mortgage agreement. If the lender doesn’t get the financial payments that it is entitled to as part of the mortgage agreement, it will attempt to reclaim the home in question. From there, after reclaiming possession and ownership of the home, the lender can re-sell it to another party to recoup the balance of the mortgage agreement.
Another question many people have is what to do about the letters and notices from the lender regarding a potential foreclosure action. The answer: don’t ignore them. The mortgage lender is required to send these notices, and if you are getting them it is time to start considering legal solutions to your financial issues.
So, what are your legal options when your family home is subject to foreclosure? Well, filing for bankruptcy can be an option. This could, at least in the short term, put a pause on the foreclosure action so that you can assess your debt obligations.
Source: FindLaw, “More Foreclosure Frequently Asked Questions,” Accessed May 14, 2017