Foreclosure Law in North Carolina
Foreclosure in Lincolnton, North Carolina 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.
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 every U.S. state, including North Carolina, 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 Lincolnton, North Carolina
It's extremely important that you engage in continued communication with your bank. Lenders are surprisingly willing to make accommodations if it means they still get paid something, but in order to accommodate your case, they have to know about it.
Throughout all this, you should remember one thing: the bank doesn't really want your house. After all, banks aren't real estate speculators, they're mainly money lenders. They stand to make a great deal of money if you are able to make your mortgage payments until it's paid off. They're likely to make much less if they're forced to sell your house.
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 North Carolina 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 Lincolnton, North Carolina real estate attorney help?
If you live in Lincolnton, North Carolina and believe that your house is in danger of being foreclosed, you may have more options and protections than you think. You may not know what all of them are, but an accomplished real estate lawyer probably will.