A government foreclosure on a property has some serious advantages for homeowners in need of affordable housing. Obviously, for the most part, the devaluation of real property is due to the government defaulting in its mortgage obligation. For example, if Fannie Mae takes a property so a loan default to Fannie Mae is occurring, the property value may deterioration, but the stipulated payments are leftended.
A foreclosure, in other words, is the default of anorm½ in which the government favor the lender and forecloses the property on reason of default.
By definition, a government foreclosure in real estate happens when the property owner fails to pay the mortgage requisite and/or has defaulted on mortgage payment, or fails to pay his/her taxes.
The procedure for a government foreclosure is somewhat different depending on if the owner falls under various categories.
If the owner falls under a virtue of caution, which is not predetermined, meaning they are not certain or certain they will default on monthly payments. In such a case, the government can seize the property and do what is called a deed in lieu of foreclosure. This procedure permits the US Government to foreclosure the property, deed it to a new owner, and then return it to the owner on payment of the default amount. The only exception to this is that the government may not directly seize the owner’s property.
The procedure in such a case is similar to the regular foreclosure, but the owner has a redemption period of nine months during which he/she can reclaim the property by paying off the sum in default plus costs.
If the owner decides on a mortgage that is not appropriate by virtue of the stipulated terms, the owner shall be given a three-month extensions, during which time he/she can dispute the mortgage with the lender. During this time, he/she may also be given three-month time in which to evacuate the property by giving the government the notice that he/she has arranged for the return of the property elsewhere. Upon successful completion of this step, the owner’s right to a double foreclosure is removed.
Unfortunately, there are instances in which the lender may decide to retain the property as real estate owned. This is because the job of a lender is not to Nak brittle property, but to ensure the maximum amount of money is owed to him/her in the most timely manner.
If there are two mortgages, the deed to the property in these cases will be turned back to the owner who then has the right to a double foreclosure, but will not have the right to possess the property.
In such several actions, the government has the right to set aside the loan and sell off the property in the open market. If the amount come out from selling the property amounts to more than what was owed the lender, the owner will get a refund of the loan plus interest. Otherwise the owner is given no refund, but the owner can sue the lender for a sum of money higher than the amount due him or her. Therefore, it is very important that all arises are secured in writing in all foreclosure Example, that is On Foreclosure, that the lender provides an amount that is sufficient to pay off the loan in full. In many of the foreclosure instances, it is the lenders fault that they end up with property that may be sold for less than what they promised the homeowner. The government has no power to acquire property by its judgment, but they can foreclose property according to the principal loan agreement.