Foreclosure Law in New Jersey
Foreclosure in Wharton, New Jersey 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.
Foreclosure most commonly is a forced sale of a house at auction, since those are the most common types of property bought through a mortgage. Banks will normally try to get rid of the property as quickly as they can, selling it for as much money as they can get in a short period of time.
In every U.S. state, including New Jersey, 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 a large number of states, but not all of them, mortgages are a type of loan recognized as a "non-recourse loan." While the regulations governing these loans are complex, it most essentially 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 Wharton, New Jersey
It is absolutely necessary 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.
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 face sudden expenses, such as medical bills or a lawsuit, which put a serious but relatively short-term strain on your finances, you should notify your lender instantly. You might find that they are willing to accept lower payments, if this will keep you from defaulting.
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 New Jersey 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 Wharton, New Jersey real estate attorney help?
In Wharton, New Jersey, dealing with a possible foreclosure is never easy. However, the assistance of a seasoned real estate lawyer can make the whole process much more bearable, and possibly delay or even prevent the foreclosure altogether.