Foreclosure Law in Indiana
In Seymour, Indiana, foreclosure is a process through which a lender that issued a mortgage loan retakes possession of the property that was bought with the mortgage in the event that the borrower has defaulted on his or her payments.
A foreclosure normally involves a forced sale of the house at auction, so the bank can recover at least some of the loss it has incurred as a result of the default. Banks normally want to rid themselves of the property as soon as possible, collect as much money as they can from the sale, and then move on.
In all states in the U.S., including Indiana, borrowers have the option of foreclosure by judicial sale. This permits a court to oversee the sale of the property by the bank. The purpose of this is to get the house to sell for the highest price possible. While this might seem like something that would only benefit the bank, it is also a great benefit to the borrower, since it increases the likelihood that the sale will encompass the full balance of the mortgage, preventing them from having to pay it.
Some states treat mortgages as "non-recourse loans." A non-recourse loan is one that is secured by the borrower's property, but for which the borrower is not personally liable. Essentially, this means that a lender in a foreclosure can take the house that was mortgaged, but nothing else. If the house sells for less than the lender is owed, it cannot go after the borrower.
How to Possibly Avoid Foreclosure in Seymour, Indiana
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.
You must keep in mind that banks are in the business of lending funds, not flipping property: the bank doesn't really want your house. To that end, they'll occasionally go to great lengths to accommodate your financial situation, whatever it may be. For banks, foreclosure is a last resort.
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.
As a last resort, you might consider a "short sale," which results in loss of the home, but it normally leads to a great deal of the debt on the mortgage being forgiven. Basically, a short sale in Indiana involves selling the house for whatever price it can fetch. The proceeds from the sale go to the lender, and if it sells for less than what's left on the mortgage, the balance of the debt is forgiven.
Can a Seymour, Indiana real estate attorney help?
If you feel that your home is close to being foreclosed in Seymour, Indiana, and want to try to prevent this, the advice and assistance of an accomplished real estate lawyer can mean the difference between keeping or losing your home.