Foreclosure Law in New York

Foreclosure in Monroe County, New York is a process that authorizes a lender to take possession of the property that was used to secure their loan, in the event that the borrower fails to repay it.

When individuals are facing foreclosure, it normally involves a house. The bank will acquire the house with the intent of selling it at an auction, hoping to cover whatever's left on the mortgage, giving them at least a chance to break even on the loan.

In every U.S. state, including New York, a borrower has a right to a judicial sale of their foreclosed property. A judicial sale is just an auction supervised by a court. The purpose of this is to make sure that the lender takes reasonable steps to sell the home for the highest possible price, and to ensure that the homeowner has an opportunity to bid on the house, if he or she is able. It is in everybody's interest for the bank to get the highest price possible for the house, even the borrower's. If the house fetches a higher price than what's left on the mortgage, the buyer can keep what's leftover. On the other hand, if it fetches less, the buyer might have to pay the deficiency.

In some states, original mortgages are recognized as "non-recourse" loans, making the above problem a non-issue. This essentially means that once the mortgaged property is sold by the lender, the debt is discharged, even if the sale nets less than the remaining balance on the mortgage. The borrower will simply have to write this off as a loss. However, this usually does not apply to refinanced or second mortgages.

How to Possibly Avoid Foreclosure in Monroe County, New York

First and foremost, you need to communicate with your lender, and not dismiss the issue. Ignoring a problem with your mortgage will not make it go away, and can only make things worse. You should be straightforward with your lender, and stay in touch with them as much as possible.

Bear in mind that banks aren't in the business of real estate speculation - they're in the business of lending money, and making profits through interest on their loans. In short, the bank doesn't really want your house - they'd much rather have you continue making your mortgage payments. For banks, foreclosing on a home is a last resort. Essentially, nobody likes foreclosures, and everyone wants to prevent them.

If you experience a sudden change in your financial situation, your lender, in an effort to keep you from defaulting, might be willing to accept lower monthly payments, at least temporarily.

Lastly, there is the "short sale." Normally considered a last resort, a short sale results in the borrower losing their home, but discharges almost all of their remaining mortgage debt. If the house is worth far less than the balance of the mortgage, this might be a good choice. In New York, when a house is sold in a short sale, the proceeds go to the lender. If it sells for less than the mortgage balance, whatever's leftover is forgiven. If it sells for more, the surplus goes to the homeowner.

Can a Monroe County, New York real estate attorney help?

If you are facing foreclosure in Monroe County, New York, and want to do everything practicable to save your house, the assistance of a seasoned real estate lawyer might prove invaluable.