Foreclosure Timeline
First Missed Payment
The first month your payment is missed, your mortgage company will probably contact you by mail and/or phone to inform you of your deliquent (overdue) status. If you are aware that you will be making no more payments, you may want to contact a real estate agent regarding a Short Sale immediately. Please contact The LaBell Team if you need assistance in this area. You may not get the full amount that you are seeking, but this is a more favorable result than foreclosure and possibly deficiency judgments on your credit report.
Second Missed Payment
The mortgage company may begin calling you to discuss why you have not made payment. It is extremely important not to avoid their phone calls. Try to stay calm and do not get defensive. They may offer to make payment arrangements or try to amend the situation without the home being lost.
Third Missed Payment
At this point, you are likely to receive a letter from the mortgage company stating the amount that you are deliquent, and that you have 30 days to bring it current. This is called your "Demand Letter" or "Notice to Accelerate." If you do not pay the specified amount or make some form of arrangements by the given date, the lender is allowed to refer you to foreclosure or accelerate your mortgage. The lender won't usually accept less than the total amount due at this time, unless you've made other specific arrangements for payment.
Fourth Missed Payment
Now you are nearing the end of the time in your Demand Letter or Notice to Accelerate Letter. If this time period expires and you have not paid the full amount or worked out arrangements, you will be referred to their attorneys. At this time, all attorney fees are added to the amount that you owe. The attorney then schedules a Sheriff Sale, which is the actual date of foreclosure. You will be notified of this date by mail, along with a notice taped to your door. Note: This is not a move-out date! You still have time to work with your lender to avoid foreclosure. Don't wait! If your home is in the short sale process, your real estate agent can be your liaison with these attorneys and the lender handling the foreclosure.
Sheriff Sale Date
This will be scheduled for approximately 4-6 weeks after the attorney receives your file. You have up until this date to work out arrangements with the mortgage company or to pay the total amount owed (often called the "Reinstatement Amount").
After Sheriff Sale
If nothing is done to resolve the situation, you enter the "Redemption Period." State Law in Michigan requires that this period be no less than 30 days and no more than one year. Most mortgages allow six months. You will be notified of your time frame on the same notice that states your Sheriff Sale date. During this time you may still reside in the house. A real estate company may periodically drive by to do Occupancy Statuses to see if you are still residing in the home.
Key Actions for You
Stay in contact with your mortgage company and real estate agent and seek assistance as early as possible. The representatives at the mortgage company are much more likely to work with you if you are up front and easy to get into contact with. Remember all of these dates are estimated and may vary according to your individual mortgage contract and state laws.