Facing foreclosure can be scary. It may come with feelings of stress and shame, which keep you from reaching out for help at the right moment. There is quite a bit of confusion surrounding the topic of foreclosure and when to hire an attorney. Not all cases of foreclosure require an attorney, but many do.
It’s truly heartbreaking when an attorney could have made all the difference in a foreclosure case but wasn’t contacted in time. Prevent this from happening to you and your loved ones by learning when it’s time to hire a foreclosure attorney.
What is Foreclosure?
Before you can understand when to hire a foreclosure attorney, you’ve got to understand the basic meaning of foreclosure. Foreclosure is a legal process in which a lender (the bank) tries to recover the amount owed on a defaulted loan by taking ownership of and selling the mortgaged property (your house). Default is most commonly triggered by a borrower missing a certain number of payments. Still, it can also be triggered by the borrower’s failure to meet any other terms established by the mortgage document.
Typically, your lender must mail you a letter called a “breach letter,” notifying you that the foreclosure process will begin if you can’t catch up on your payments. Before you reach the point of foreclosure, check to see if you qualify for mortgage forbearance or deferment. You can save your home despite any financial troubles you may be experiencing.
Consequences of Foreclosure
Unfortunately, foreclosure is very serious and can have some long-lasting personal and financial consequences, such as:
- Eviction: You’ll lose your home and, potentially, other valuable assets.
- Damaged credit: Credit affects everything from your access to housing, loans, and sometimes employment opportunities. It can take years to reestablish good credit.
- Inability to purchase another home: According to Fannie Mae guidelines, when your home is foreclosed, you’re ineligible to get a mortgage to buy another home for at least seven years.
- Degraded mental health: The process of going through home foreclosure is known to be stressful and embarrassing due to the uncertainty of your housing and financial situations being revealed.
- Owing more money: Depending on the health of the housing market, you may still owe money after your home has been foreclosed on.
How Do I Know it’s Time to Get Help?
Even if you’ve already exhausted your mortgage forbearance and deferment options and received a breach letter, foreclosure can still be prevented. Once you’ve received the breach letter, you should call an attorney.
Although you may not realize that an attorney can help you, you must get help if you think you have a defense against foreclosure. Some examples of a defense against foreclosure are:
- The loan servicer didn’t follow standard foreclosure procedures.
- The foreclosing entity can’t prove it owns your loan.
- The servicer made an error.
- Military service (the Servicemembers Civil Relief Act provides special circumstances to military members)
- The bank engaged in dual tracking (the bank proceeds with the foreclosure while negotiating the homeowner’s application for a loan modification simultaneously)
What Does a Foreclosure Attorney Do?
Fighting a foreclosure means filing documents with the court, understanding the rules of evidence, and much more. An experienced attorney can help you successfully navigate these confusing procedures.
By waiting too long to hire an attorney, you risk missing important deadlines. If your home is officially foreclosed on before you seek legal aid, you may not be able to get your home back, even if there was wrongdoing in the process. When an attorney is allowed enough time, they may be able to cut a deal with the bank that avoids foreclosure and going to court altogether.
If you’re wondering, “What can a foreclosure attorney do for me?” here are some examples of ways they can create solutions to your foreclosure problems:
Loan Modification
An attorney can negotiate a loan modification agreement between you and the lender that changes the loan’s original terms.
Loss Mitigation Information
Like Fair Housing Administration (FHA) loans, certain loan types contain special loss mitigation clauses that will let you shift your balance into good standing.
Make Sure Lenders Follow Rules
Lenders aren’t always as helpful as they should be, despite strict federal and sometimes state laws that lenders must follow. An attorney can make sure all the rules have been followed and that you’re aware of all the options available to you.
Help you File for Bankruptcy
Many people whose homes are foreclosed on don’t have the money to cover expensive legal battles, or their lender won’t modify their loan. In this case, an attorney can help you file for Chapter 13 bankruptcy.
How to Hire an Attorney
Hiring an attorney doesn’t have to be difficult, particularly because you already know what type of attorney you need. If you’re ready to fight for your home, there are a few steps you can take to hire a foreclosure attorney.
- Schedule a consultation via phone or in-person. Most lawyers will do this without charge or for a fee.
- Explain what’s going on and who is involved. If it doesn’t feel like a good match, call someone else.
- Tell the truth. An attorney can only help you if you share all the details of your situation.
- Ask for an estimate. How much are attorney fees for foreclosure? Attorney fees vary widely, so that’s a conversation you’ll want to have.
- Understand the risks. Know what you’re willing to lose and draw clear boundaries.
- Hire an experienced attorney. A lawyer who knows what they’re doing will guide you through this difficult process with confidence and ease.
CJB Law Can Help You Keep Your Home
You only stand to gain from knowing your rights, whether you own a home or rent a home. By taking the time to learn what proper lender-borrower conduct looks like, you’re less likely to be taken advantage of and more likely to know when legal aid is needed. If you need a power of attorney to help keep your home from foreclosure or any other legal matter, CJB Law is here for you. Our attorneys are thorough, reliable, and proactive. Get the professional help you need to solve your legal troubles today. Visit our website to learn about our areas of practice and schedule a free consultation.