Life can take you by surprise, and some of those surprises can significantly affect your finances. Receiving a notice of default is frightening and not a situation people willingly put themselves in.
Unexpected changes like a sudden job loss, medical emergency or contentious divorce can put you in a bind. When those challenges put you at risk of losing your home, gathering the strength to defend against foreclosure makes a big difference in protecting your family’s future.
Considerations after receiving a foreclosure notice
You have several options after receiving foreclosure documents. Factors you should consider include:
- Whether your lender or condo owners association (COA) started the process
- Whether the foreclosure is judicial or non-judicial
- Whether or not you’re considering bankruptcy
You likely can’t avoid the consequences of non-payment, but you can choose how you’ll face them.
Defending against foreclosure
Depending on the case, you can start looking into:
- Negotiating with your lender: Ask your bank or other lender if they can lower the interest rate, temporarily reduce the payment or modify the loan term.
- Mitigating loss: Ask for forbearance. See if the lender allows short sales or accepts deeds in lieu of foreclosure.
- Challenging the foreclosure: You can argue that the foreclosure lacks standing or didn’t follow legal procedures.
Your financial capacity should inform your decision to avoid further complications.
Challenging the foreclosure
If you decide to challenge the foreclosure, you can build your defense by examining factors such as:
- Mortgage validity: If there are issues with the mortgage document or the possibility of fraud
- Selective enforcement: If the COA inconsistently enforces assessments or rules
- Statute of limitations: If the foreclosure process didn’t follow the mandated timeline
- Regulatory compliance: If the lender or COA didn’t follow foreclosure rules, such as setting a face-to-face interview and properly sending notices
- Payment crediting: If the lender or the COA received your payments but didn’t record them
With a strong defense, it may be possible for you to keep your home despite defaulting under the terms of your mortgage. Choosing the defense strategy that fits your case best is crucial. Knowing your rights as a condo owner is also invaluable in determining whether the foreclosure complies with real estate law.
