In Foreclosure

Power of Sale Foreclosure vs. Judicial Foreclosure, how fast can the bank foreclose?

First of all, most lenders will not begin foreclosure proceedings until a borrower is 3-6 months behind on their payments. Although missing a single payment is a default under the terms of most loan documents, lenders have neither the time nor the desire to foreclose on borrowers who have missed one payment. The process will be initiated when it becomes clear that the debt can no longer be serviced. This post deals with the timing of a foreclosure once your lender has started the process and has instituted a foreclosure action against your property.

The speed with which a bank can foreclose on a borrower varies based on state law. There are basically two different types of jurisdictions for foreclosure purposes: power of sale jurisdictions and judicial foreclosure jurisdictions. In over half the states, the prevailing method of foreclosure is non-judicial power of sale foreclosure. What does this mean? If you have entered into a deed of trust with your mortgage lender, your deed is held by a Trustee pending full payment of your note. In the event you fail to make your mortgage payments the trustee has authority to sell your home at auction. Power of sale foreclosure can occur much more quickly than judicial foreclosure because the trustee vested with the power of sale does not need court oversight to sell the property. The trustee will give Notice of a public foreclosure sale and then sell the distressed property to the highest bidder. A court will usually not oversee the process. If a default has occurred the trustee is permitted to go through with the

foreclosure sale after a relatively short notice period (usually two to three months from the date foreclosure proceedings are instituted). If you live in a power of sale Jurisdiction, your mortgage lender can complete the foreclosure process in two to three months. Today, 29 states (Alabama, Alaska, Arizona, California, Colorado, the District of Columbia, Georgia, Hawaii, Idaho, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nevada, New Hampshire, North Carolina, Oregon, Rhode Island, South Dakota, Tennessee, Texas, Utah, Washington, West Virginia and Wyoming) allow foreclosure by the power of sale

Judicial foreclosure is available in every state and is the required method of foreclosure in many states. Judicial foreclosure jurisdictions require a court to oversee the foreclosure process. Like power of sale jurisdictions, all interested parties must receive notice of the foreclosure sale. Judicial foreclosure proceedings can take a year or more to be completed . The requirement that the lender foreclose through the court system slows down the process considerably. While either method of foreclosure can be successfully challenged by an attorney, the court oversight of judicial foreclosure allows more procedural leverage to slow down aggressive lenders.

It is important for consumers to understand that they have rights in the fight against foreclosure. Power of sale jurisdictions allow for your property to be sold outside of court supervision but they still require you receive adequate notice of the sale and that your property be sold for a reasonable price. Hiring an experienced foreclosure defense attorney in a judicial foreclosure jurisdiction could buy you months while you fight back against the bank. Bankruptcy, although a last resort, will stop a foreclosure dead in its tracks due the Automatic Stay that freezes all creditor collection actions the minute a case is filed. I have filed many bankruptcy cases for clients the night before their home was scheduled to be sold at auction and had the process stopped. Chapter 13 bankruptcy may allow you to stay in your home while getting caught up on mortgage arrearages that have spiraled out of control. You have options and there is help available, but remember if you are in a power of sale jurisdiction and have

executed a deed of trust with your lender, the foreclosure process can be completed in a matter of months.

Bankruptcy attorneys legally help individuals or businesses get rid of debt. They can do this by liquidating assets and repaying creditors with money collected from the sell-off or developing a repayment plan with the court

The time it would take for you to file bankruptcy depends on which type of bankruptcy you choose to file.

The time period it takes for your bankruptcy to discharge your debts can have several factors.

In recent years, the rate of filed bankruptcies has been closely tracked. From the recent high in 2005 of bankruptcy filing, the year 2006 represented a significant drop in the reported number of filings, but after the end of 2006, the rate of bankruptcy filing has started to increase again.

One of the factors for this may be the new bankruptcy ruling laws that requires consumers to attending financial management and credit counseling sessions before they can file bankruptcy. But since that law was put into effect, numerous studies have shown clearly that such counseling does little good for the consumer. The big problem with this law is that it makes the assumption that the consumer who is filing bankruptcy is doing so out of excessive financial mismanagement or credit abuse. Anyone who has spent any amount of time studying the underlying causes for why someone would file bankruptcy can tell you, almost after a casual glance, that this is not the case at all with the majority of consumers who file bankruptcy.

The studies bear this fact out. In fact, out of more than 400,000 consumers that were counseled via these mandatory classes before filing bankruptcy, more than 95% of them continued their bankruptcy filing after completing the classes. The biggest problem here is that by the time a consumer is in a situation to need to file bankruptcy, they have typically exhausted all other viable options, and it is too late to make any significant difference for almost all of them.

The following can be considered early warning signs of possible future bankruptcy that consumers should be aware of:

No/little savings cushion

Most consumers in the US have little or no savings to rely on in case of an expected huge necessary expense. Most Americans spend more than they earn, and they finance their greater lifestyle on credit cards and borrowing from Peter to pay Paul. Although saving is hard, a shift needs to occur in the minds of most consumers about putting a higher emphasis on savings instead of always "living for today".

Consistently living paycheck to paycheck

Many people say they do not enjoy it but find themselves living from paycheck to paycheck, such that when something happens to prevent that next paycheck from showing up, like a job layoff, they are already in deep sneakers. Some reports have indicated that more than 60% of Americans are in this situation.

Higher than 20% non-mortgage debt to income ratio

If you are spending more than 20% of your net income to pay your credit cards and financial obligations outside of your mortgage, this is a problem, and a warning sign that financial troubles could be near.

Always making only minimum payments on credit cards

Almost half of all people who have credit cards carry a balance forward from month to month. If you pay only the minimum payment due each month, it will take you three or more times as long to pay off the balance, even if you don't charge anything more to the card.

Inadequate insurance

Many people consider insurance to be a ripoff

Steps to Take Before Filing Chapter 7, Chapter 13, or Chapter 11 Bankruptcy in Tucson

Bankruptcy is a legal proceeding in which a person who cannot pay his or bills can get a fresh financial start.

Watching the stock market drop like an airplane hitting an air pocket and then rising only to drop again is enough to give you heartburn, even for a California finance attorney. Business, real estate, corporate and finance lawyers, whether they practice in San Diego, Orange County, Palm Springs or Indian Wells think they have seen it all when it comes to seeing finance fraud in litigation cases. But the testimony we have been hearing about the fraud in the financial markets is enough to turn your hair white, if you have any left. The words I've been hearing are making people quake in their boots. Panic, stock crash, depression, bank runs...

Somebody, pass me the Tums, will you?

Yes, there were professors from esteemed institutions of higher learning saying that the bailout proposal Congress passed wouldn't solve the problem, and yes, they may have been right, but neither them being right nor the passing the bailout bill hasn't calmed the financial markets in the U.S. or the rest of the world. The Dow has been dropping 300, 500, 600, and nearly 700 points now for, well, I've lost track of how many days it has dropped. Many are now routinely calling it a stock crash. Others are now calling the Great Depression of the 1930s the First Great Depression. Has anyone seen my 401K or IRAs? Last I saw they were going down the sewer.

Does anyone have some milk for my stomach?

Yes, there are also people out there saying that the financial bailout was a bad idea all around. That it rewarded the rich, and those foreign investors who got sucked into buying our financial stocks. As it turned out, they may have needed it just as much as we do. Last I heard, Iceland was facing bankruptcy as a country and now that their markets are falling like leaves, it's throwing more wood onto our own fire sale on Wall Street.

Does anyone know if alcohol and Tums are a bad combination?

Reports are that the Federal Reserve and foreign central banks are making hundreds of billions of dollars and euros and other currencies available for the world's banking systems to boost the amount of money available for lending so banks will feel confident to start lending to one another and to businesses again. Anyone feel confident yet? Anyone tried to get a loan lately?

Has anyone seen my bottle of scotch?

I think we just learned what it was that scared Hank Paulson, George Bush and all the rest of the usual suspects who testify to Congress that the world was in effect going to come to and end if the bailout plan wasn't passed. Well, it turned out they were almost right, despite passing the Bailout Plan. No the world isn't coming to an end, and we don't have a depression like in the 1930s, but in case there is something more that our leaders know that is still going to cause something else to implode, could they just tell us exactly when it is set to implode? I want to make sure I have my head ducked under something.

Isn't Tagamet good for an upset stomach, or is that Pepto Bismol?

Yes, I know that all is not good in the world of credit card balances, student loan programs, home mortgages, equity lines of credit, construction loans, corporate debt, auto loans, commercial real estate loans and those swaps that you hear about but don't really know exactly what they consist of on the financial channels. But, last I checked, hey, I'm still here. They still have groceries on the shelves, they still take my credit card and gas is getting cheaper by the day.

Hey, Houston, Ground Control, we're still here!

We all know that the healthcare system in the United States is a relatively unsecure one. Many people can