Foreclosure is something no homeowner ever wants to go through. Not only do they lose their home, but the entire process can become very confusing. Foreclosure happens when a lender or borrower fails to make their mortgage payments and the mortgage investor must take back the property. There are many reasons why a homeowner may fail to make payments on their home, such as being laid off, taking on excessive debt, relocating, etc. If you find yourself facing foreclosure in the Johnson County Kansas area, make sure you understand how it works. The following is a brief overview of the five stages of foreclosure in Johnson County KS that are important to know about:
Stage 1: Missed Payments
For someone to face foreclosure, they have to miss at least one payment on their mortgage, which brings us to the first stage. Most lenders often give their borrowers a 15-day grace period before charging a late fee and a missed payment notice. Once two payments are missed, lenders typically send a demand letter. These letters are usually sent by a lawyer requesting some form of restitution.
Stage 2: Notice of Default (NOD)
After 90 days of missed payments, a notice of default is sent to the homeowner. This is sometimes referred to as a public notice. It is written to notify the homeowner that the lender has handed the loan over to the Johnson County KS foreclosure office and will pursue legal action if the debt is not paid.
This is when the lender may give the homeowner another 90 days after the notice of default is sent to pay the debt. This is what’s known as the “reinstatement period.”
Stage 3: Notice of Trustee’s Sale
If the homeowner does not settle the debt within 90 days of receiving the notice of default, then a notice of trustee’s sale will be recorded. This notifies the homeowner and the public that the property will be available for auction. The notice includes information about the property, including the address and when the auction will take place.
Stage 4: Auction
When the time comes for the public auction to occur, also known as a trustee sale, the foreclosed property is awarded to the highest bidder. The lender will set a minimum bid based on the outstanding loan, unpaid taxes, any liens, and other associated costs. If the property does not sell during the auction, it becomes a real estate owned property (REO), also referred to as a “bank owned” property.
Stage 5: Eviction
Once the home is sold in either the auction or as an REO property, an eviction notice is sent, and the occupants must vacate the home immediately.
Facing Foreclosure in Johnson County?
Are you facing a financial struggle and are worried about being evicted from your home? Our team at Cherry Park Properties can help you fight foreclosure. We have decades of experience dealing with Johnson County foreclosure laws and helping our clients get out from under the burden of foreclosure. Contact us today for a free consultation!