Castle Law Office Blog | Missouri & Illinois Bankruptcy Legal Blog

Terms To Know: Foreclosure

Very simply, foreclosure is the process of a creditor (such as a bank or mortgage company) claiming a property after a borrower has been delinquent in his or her payments. Foreclosures settle the debt between the property owner and the lender and result in the homeowner losing their rights to the property.

Foreclosure proceedings can begin after a homeowner's mortgage payment is 90 days late. However, the entire foreclosure process can take well over a year.

There are several strategies to avoiding foreclosure and keeping your house or property. First, you may pay back what you owe, along with interest, late fees, taxes, insurance, appraisal fees, attorney feels, court costs, and any other costs. Other alternatives to foreclosure include refinancing your mortgage, negotiating with your lender, or setting up a short sell. Chapter 13 bankruptcy is also one way that borrowers can keep a home that is in danger of foreclosure.

There were almost 275,00 foreclosure filings in the United States last month - and foreclosure activity has increased 20 percent just in the last year.