Day 1:  It’s the first of the month and the mortgage payment is due.  The borrower misses the payment.

Days 16 thru 30 - A late charge is assessed.  The company that processes the borrower’s payments (called the mortgage servicer) begins to make contact with homeowner regarding the late payment.  A file is sent to its collections department.

Days 45 thru 60 - The servicer sends a “demand or breach” letter to borrower’s home, pointing out that terms of the mortgage have been violated.  The borrower is given 30 days to resolve the situation by paying the delinquent amount. 

Day 90 - Foreclosure proceedings begin with a Notice of Default (NOD).  The document is recorded in the county in which the property is located.  The recording of Notice of Default gives “Constructive Notice” to the public to signify that a person or entity is legally presumed to have knowledge of something, even if they have no actual knowledge of it.  After the recording of the Notice of Default, the borrower and junior lien holders are given proper notification and the borrower has 90 days to bring the account current.  This period is referred to as the Reinstatement period.

Day 180 – If the borrower does not reinstate their account within the 90-day period, the lender will authorize and instruct the Trustee to record the Notice of Trustee Sale (NOS).

Day 201:  After 21 days of the recording of the NOS, a foreclosure sale can take place at public auction.  The property may be sold to a third party bidder or revert back to the lender for a specified amount.

An awareness of this timeline is important for homeowners in a situation of foreclosure so they can plan their next step options accordingly.  With the current volume of foreclosures depending on the area where the home is located, it could take almost a year for a foreclosure proceeding to be completed.  You can continue to live in your home during the process.

As you work through the foreclosure process, assistance is available to you.  Whether you are in need of assistance with loan, foreclosure counseling, or help getting out of a predatory loan, there is help. 

No Cost Counseling
Start by talking with a foreclosure counselor.  The National Foreclosure Mitigation Counsel received $360-million from Congress in December 2007 to increase the availability of foreclosure counseling services across the country. To find a no-cost foreclosure counselor in your area, visit Neighborhood Works America.

Another free source to gain valuable information is the Housing and Urban Development Agency (HUD) document entitled “Guide to Avoiding Foreclosure”.  This document provides useful information for assessing foreclosure risk and tips to avoid foreclosure and foreclosure scams. The site also offers tips if you cannot keep your home, such as rental assistance, relocation resources, and explains the “Redemption Period”, your last chance to save you home.