Foreclosure Law in Louisiana
In Tallulah, Louisiana, foreclosure is a process through which a lender that issued a mortgage loan retakes possession of the property that was purchased with the mortgage in the event that the borrower has defaulted on his or her payments.
When consumers have to deal with foreclosure, it almost always involves a home. The bank will usually take possession of the house, and then sell it at auction, to try to cover the balance of the mortgage. Banks normally want sell the property quickly, for as much money as possible.
In every U.S. state, including Louisiana, a borrower has a right to a judicial sale of their foreclosed property. A judicial sale is simply an auction overseen 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 considered "non-recourse" loans. This means that once the house or other property that secured the mortgage is sold, and if it sells for less than the balance of the mortgage, the lender has to absorb the loss, and cannot sue the borrower for the remainder. This normally does not apply to second mortgages or refinanced loans.
How to Possibly Avoid Foreclosure in Tallulah, Louisiana
Communication between you and your lender is perhaps the most important way to avoid foreclosure. Ignoring the issue is guaranteed to be counterproductive. Honesty is the best policy when it comes to dealing with lenders.
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. Basically, nobody likes foreclosures, and everyone wants to avoid them.
Because banks don't particularly enjoy foreclosing, they will probably be willing to work out an alternative payment plan with you, if necessary. However, if you think that this might be needed in the near future, you should contact your lender immediately. The sooner they know about it, the more options you have.
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 Louisiana 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 Tallulah, Louisiana real estate attorney help?
If you feel that your home is close to being foreclosed in Tallulah, Louisiana, 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.