What will banks accept on a foreclosure

You will generally start to receive communications as soon as you miss one payment, and those communications might include a notice of intent to move forward with the foreclosure process.

In general, lenders initiate foreclosure proceedings three to six months after you miss your first mortgage payment. If, by the end of the fourth month of missed payments, you still have not made the payment, many lenders will consider your loan to be in default and will refer you to the lender's attorney. Read all of your notices and agreements carefully and speak with an attorney or a U. A judicial or nonjudicial foreclosure ensues.

When it comes to foreclosure proceedings, there are two types of states: judicial and nonjudicial states. In judicial states, your lender must bring legal action against you in the courts to foreclose. This process takes longer, as you often have 30 to 90 days in between each event. But in either type of state, you will be given written notice to make payment followed by a "Notice of Default" and a "Notice of Sale. You can stop the process. In certain states, lenders are required to offer borrowers the option to reinstate the loan and stop the foreclosure process.

Whether or not those options are realistic or feasible is another matter. Lenders might say that you can reinstate the loan anytime after the "Notice of Sale" up until the foreclosure date the sale date and stay in the home if you make all or a substantial portion of your missed payments and cover the legal fees and penalties charged so far. You might also have an opportunity to pay off the loan in its entirety, but this may only be feasible if you manage to refinance the home or find a substantial source of money.

Be prepared for an auction and eventual eviction. If nobody else buys the home which is common , ownership goes to the lender. Local laws dictate how long you can remain in the house after foreclosure, and you should receive a notice informing you of how long you can stay.

Get a second chance through a redemption. Many states offer what is known as redemption, a period after the foreclosure sale occurs when you can still reclaim your home.

The "Notice of Sale" will generally inform you about the redemption period, and timeframes vary by state. You generally must be willing to pay the loan balance that you owe and any costs associated with the foreclosure process to reclaim in the home. It often takes four months after you miss your first payment before you are officially in default of your loan.

The main outcome of going through foreclosure is, of course, the forced sale and eviction from your home.

How foreclosures work also makes them expensive. As you stop making payments, your lender may charge late fees, and you might pay legal fees out of pocket to fight foreclosure. A foreclosure will also hurt your credit scores.

Ownership will be transferred in one month. Welcome to ForeclosureIndia. Committed to help getting fair deal for their property in the market by giving wide publicity on the mostly used internet media, guide them about their rights, the procedures involved and assist them in getting their grievances, if any settled through appropriate channels. Buyers of the Property.

Committed to provide on their computer a wide range of foreclosure properties to choose, make them aware of the procedures followed by financial institutions, enhance their knowledge on related acts, rules and latest news, furnish information about specified choice through mail, inspect the properties and participating in auctions on their behalf and assist them in getting their grievances, if any settled through appropriate channels.

Financial institutions. Obtain all tax papers to ensure that all documents are up to date. Give yourself comfortable time. Do not hurry your purchase or loan in any case.

Shopping around for a home loan will help you to get the best financing deal. Shopping, comparing, seeking clarification and negotiating with banks may save you thousands of rupees. Home loans are available from mainly two types of lenders--commercial banks and housing finance companies. Find out how much of a down payment you are required to pay, and find out all the costs involved in the loan including processing fees, administrative charges and prepayment charges levied by banks.

Knowing just the amount of the EMI or the interest rate is not good enough. Similarly, ask for information on loan amount, loan term, and type of loan fixed or floating so that you can compare the information and take an informed decision. Ask your lender about its current home loan interest rates and whether the rate is fixed or floating. Remember that when interest rates in the economy go up so does the floating rates and hence the monthly re-payment.

If the rate quoted is a floating rate, ask how your rate and loan payment will vary, including the extent to which your loan payment will be reduced when rates go down by a certain percentage. Also ask your bank whether the index is internal or external and how and where it is published.

The APR takes into account not only the interest rate but also fees and certain other charges that you may be required to pay, expressed as a yearly rate. Banks are obliged to reveal the APR if requested for by the customer. Check the reset clause, especially in the case of fixed interest rate loan as the rates will not be fixed throughout the tenure of the loan.

Check if the margin in the case of the floating rate is fixed or variable. The rate of interest you have to pay will vary accordingly. A home loan often requires payment of various fees, such as loan origination or processing charges, administrative charges, documentation, late payment, changing the loan tenure, switching to different loan package during the loan tenure, restructuring of loan, changing from fixed to floating interest rate loan and vice versa, legal fee, technical inspection fee, recurring annual service fee, document retrieval charges and pre-payment charges, if you want to prepay the loan.

Every lender should be able to give you an estimate of its fees. Ask what each fee includes. Sometimes several components are lumped into one fee.

Ask for an explanation of any fee you do not understand. Also, remember that most of these fees are perhaps negotiable! Do negotiate with your bank before agreeing to a particular fee. See how the all inclusive rate compares with the all inclusive rates offered by other banks. While planning your finances, don't forget to include the costs of stamp duty and registration. Once you know what each bank has to offer in terms of rates, fees and down payments, negotiate for the best deal.

Ask the lender to write down all the costs associated with the loan. Then ask if the bank will waive or reduce one or more of its fees or agree to a lower rate.

Do make sure that the bank is not agreeing to lower one fee while raising another or to lower the rate while raising the fees. Ask for clarification in case you do not understand any particular term.

All banks are obliged to explain the most important terms and conditions of the home loan in detail. Once you are satisfied with the terms you have negotiated, please do obtain a written offer letter from the lender and keep a copy with you. Read the offer letter carefully before signing. Yes, most banks allow you to repay the loan ahead of schedule by making lump sum payments.

Prepayment penalty may vary according to the reasons and source of funds - if you obtain a loan from another bank for pre-payment the charges are usually higher than when you pay from your own sources. However, you may credit more than your EMI amount into your loan account on a periodic basis and bring down your interest burden as and when funds are available with you. Most banks do not charge a pre-payment penalty if you deposit more than your EMI payable on a periodic basis.

Please check such stipulations while availing the loan. When other banks reduce the interest rate, you may prefer to close your account with the bank with whom you are banking, to avail of the loan from the bank offering reduced rates of interest.

You have to pay pre-payment charges for doing so. In order to ensure that their customers do not approach other banks for availing reduced interest rates, banks allow customers to switch over from a higher interest loan to a lower interest loan by paying a switch over fees which is lesser than the pre-payment charges. Generally switchover fee is taken as percentage of the outstanding loan amount. Keep up-dating yourself on various changes in the home loan market.

Visit the branch, discuss with the officials to get the best out of any changes in the home loan scenario. Resident Indians are eligible for certain tax benefits on both principal and interest components of a loan under the Income Tax Act, Under the current laws, you are entitled to an income tax rebate for interest repayment up to Rs.

Moreover, you can get added tax benefits under Section 80 C on repayment of principal amount up to Rs. What are the minimum standards that banks are required to follow when they sell you a home loan? If you have a complaint against only scheduled bank on any of the above grounds, you can lodge a complaint with the bank concerned in writing in a specific complaint register provided at the branches as per the recommendation of the Goiporia Committee or on a sheet of paper.

Ask for a receipt of your complaint. The details of the official receiving your complaint may be specifically sought. If the bank fails to respond within 30 days, you can lodge a complaint with the Banking Ombudsman. Please note that complaints pending in any other judicial forum will not be entertained by the Banking Ombudsman. A unique complaint identification number will be given to you for tracking purpose.

Complaints are to be addressed to the Banking Ombudsman within whose jurisdiction the branch or office of the bank complained against is located.

Complaints can be lodged simply by writing on a plain paper or online at www. Complaint forms are available at all bank branches also. If you are not happy with the decision of the Banking Ombudsman, you can appeal to the Appellate Authority in the Reserve Bank of India. What is reverse mortgage loan? What is my eligibility and how I will get back the title deeds? The scheme of reverse mortgage has been introduced recently for the benefit of senior citizens owning a house but having inadequate income to meet their needs.

Some important features of reverse mortgage are:. Note- Reverse mortgage is a fixed interest discounted product in reverse. It does not take into account the changes in interest rates as yet.

Important — This part is fine printed to help you practice reading the fine print.