Foreclosure Law in Idaho

In Buhl, Idaho, foreclosure is a legal process through which an entity which has issued a mortgage takes possession and/or ownership of the property that secured the mortgage, because the person who took out the mortgage has consistently failed to make payments on it. The property in question is usually a house.

If an ordinary consumer faces foreclosure, it typically involves a home that was purchased with a mortgage from a bank. The bank will typically try to sell the house at a public option, with the hope of at least covering the remaining debt, to avoid taking a large loss.

In Idaho, and every other state, foreclosed homeowners can go through a "foreclosure by judicial sale." In this type of foreclosure sale, a court supervises the sale, ensuring that the bank makes every reasonable effort to get the highest price possible for the house. The purpose of this is to maximize the chances that the bank gets, at the very least, the remaining balance of the mortgage. Although this may seem counter-intuitive, it is intended to protect the borrower: it helps prevent them from still owing money after the house is sold at auction.

In a large number of states, but not all of them, mortgages are a type of loan identified as a "non-recourse loan." While the regulations governing these loans are complex, it most basically means that, once the house is sold, and the sale price doesn't cover what the borrower owes, the lender can't go after the borrower for the remainder. They simply have to take the loss.

How to Possibly Avoid Foreclosure in Buhl, Idaho

To avoid foreclosure, communicating with your lender is key. Let's face it - if you're in a situation where foreclosure looks like a possibility, your life is not going to be easy for some time. While it's difficult to step up and acknowledge unpleasant facts, doing so will make your life much easier in the long run. If your lender is aware of your situation, it's far more likely that you'll be able to work something out with them.

You should be mindful of the fact that your bank wants you to make your monthly mortgage payments - they probably aren't scheming to trick you into giving up your home. This isn't out of altruism, it's due to the fact that foreclosure is almost never as lucrative for the bank in the long run than a mortgage that is paid in full over a period of years or decades, with interest accruing the whole time. For a bank, a foreclosure is simply a last resort to cut their losses.

If your financial situation suddenly changes, your lender may be willing to change the terms of your loan, at least temporarily, allowing for lower monthly payments. If this means that they will be able to get some money from you, with default as the alternative, it can become an attractive option for everyone involved.

In Idaho, some buyers have no choice but to resort to a short sale. This is simply the sale of the house, and using the funds to pay off the remainder of the mortgage. One advantage of a short sale is that, if the house sells for less than the mortgage balance, the remaining debt is excused, and the borrower is free and clear.

Can a Buhl, Idaho real estate attorney help?

If you are worried that your Buhl, Idaho house is going to be foreclosed, and want to try and stop this, a knowledgeable real estate lawyer can help.