Foreclosure Law in New York
Foreclosure in Great Neck, New York is a process that permits 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.
When individuals are facing foreclosure, it typically involves a house. The bank will acquire the house with the intent of selling it at an auction, hoping to cover whatever's left on the mortgage, giving them at least a chance to break even on the loan.
In New York, and every other state, foreclosed homeowners can go through a "foreclosure by judicial sale." In this form of foreclosure sale, a court supervises the sale, ensuring that the bank makes every reasonable effort to get the highest price possible for the house. The purpose of this is to maximize the chances that the bank gets, at the very least, the remaining balance of the mortgage. Although this may seem counter-intuitive, it is intended to safeguard the borrower: it helps prevent them from still owing money after the house is sold at auction.
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 Great Neck, New York
It is absolutely imperative 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.
You should remember that the bank doesn't really want your house. They issued a mortgage hoping to make a profit from interest, and that's what they'd much rather do. They aren't in the business of buying and managing real estate. Therefore, banks will sometimes go to surprising lengths to accommodate your financial hardship, especially if it's temporary.
If your financial situation suddenly changes, your lender may be willing to change the terms of your loan, at least temporarily, permitting for lower monthly payments. If this means that they will be able to get some money from you, with default as the alternative, it can become an attractive option for everyone involved.
Some buyers in New York, when none of the above options have worked, resort to a "short sale." This includes selling a house which is about to be foreclosed, typically for less than its market value. If the house sells for less than what's left on the mortgage, the homeowner is relieved of the duty to pay the balance. If you have decided that you have no hope of making your mortgage payments, and foreclosure seems inevitable anyway, this might be the way to go.
Can a Great Neck, New York real estate attorney help?
In Great Neck, New York, dealing with a possible foreclosure is never easy. However, the assistance of a reliable real estate lawyer can make the whole process much more bearable, and possibly delay or even prevent the foreclosure altogether.