Foreclosure Law in Missouri

In Ferguson, Missouri, 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.

If an ordinary consumer faces foreclosure, it usually involves a home that was purchased with a mortgage from a bank. The bank will usually 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 all states in the U.S., including Missouri, 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.

In some states, original mortgages are regarded "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 usually does not apply to second mortgages or refinanced loans.

How to Possibly Avoid Foreclosure in Ferguson, Missouri

It is absolutely essential that you maintain a line of communication with your lender. Your can't expect your lender to accommodate your altered financial situation if they don't know about it. Ignoring the issue and hoping it will go away is the worst possible solution.

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.

It's possible that your lender is willing to negotiate a plan that results in temporarily-lower payments on your mortgage, particularly if this means that they will be able to get some payments, instead of none at all.

In Missouri, 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 benefit of a short sale is that, if the house sells for less than the mortgage balance, the remaining debt is discharged, and the borrower is free and clear.

Can a Ferguson, Missouri real estate attorney help?

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