In some instances, panicked homeowners leave their home after missing a few mortgage payments or once a foreclosure is initiated. However, you have the legal right to remain in your home until the foreclosure process is completed. This process can take a few months or, in some cases, as much as a year (or even longer in states with a large backlog of foreclosures, such as Florida and New York). Read on to find out more about when you have to leave your home as a result of foreclosure.
(To learn the ins and outs of the foreclosure process, and foreclosure procedures in your state, visit our Foreclosure Center.)
When You Start Missing Payments
You do not need to leave you home simply because you miss a couple of mortgage payments. If you miss one or two payments, your lender or loan servicer will most likely first send you a few letters reminding you to get caught up.
After you miss three or more payments, the lender or loan servicer will probably send you a letter informing you that your loan is in default and that you need to bring the loan current. (Most home mortgages and deeds of trust contain a clause that requires the lender to send this notice before formally starting the foreclosure. The letter is often referred to as a “breach” or “demand” letter.) The letter will inform you that foreclosure proceedings will begin if you do not cure the default by paying the amount specified in the letter by a certain time, usually within 30 days.
If you don’t cure the default by paying the amount specified in the breach letter, the lender or loan servicer will officially start the foreclosure process. Depending on your state and your circumstances, the foreclosure will be either judicial or nonjudicial.
Judicial foreclosure. Judicial foreclosures go through the state court system. You will receive a complaint and summons informing you that a foreclosure lawsuit has been filed against you. You will have a certain number of days, frequently 20 or 30, to respond. (If you do not file an answer to the lawsuit, you will automatically lose the case and the court will issue the lender a default judgment permitting it to proceed with a foreclosure sale.)
Nonjudicial foreclosure. If you’re in a nonjudicial foreclosure state, the lender does not have to go through the state court system to foreclose. In a nonjudicial foreclosure, you will receive:
- a notice of default (followed by a notice of sale)
- a combined notice of default and sale
- a notice of sale stating that the property will be sold on a certain date, or
- notice by publication in a newspaper and posting on the property.
Even though the lender has begun the foreclosure process, you do not have to vacate the property yet. With both judicial and nonjudicial foreclosures, there is a period of time between notification of the foreclosure and the actual sale. You may remain in the property during this time, which is typically two months to a year (sometimes more), depending on the state and whether the foreclosure is judicial or nonjudicial. (Judicial foreclosures usually take longer.)
To learn more about the difference between judicial and nonjudicial foreclosure, and the procedures for each, see Will Your Foreclosure Take Place In or Out of Court? To find out if you live in a state that typically uses a judicial or nonjudicial process, check our Summary of State Foreclosure Laws and How Foreclosure Works.
The Foreclosure Sale
You legally own your property until the day of sale and may remain there until this time. Additionally, in some states, you may be able to stay in the property through the expiration of the redemption period or until some other action, such as ratification of the sale, occurs.
Also, keep in mind that prior to the foreclosure sale you may be able to delay the foreclosure and extend the amount of time that you can remain in your home by applying for loss mitigation options or entering into in an official foreclosure avoidance mediation program if your state has one. See our Alternatives to Foreclosure and State Foreclosure Mediation Programs areas for more information.
Eviction After the Foreclosure Sale
At this point, if you do not vacate the home, the new owner (often the lender) will start eviction proceedings to remove you from the property. Depending on your state's law and the circumstances of your case, the lender or loan servicer may have the option of initiating the eviction as part of the foreclosure action. Other times it may have to file a separate eviction action with the court.
In certain states and circumstances, the lender or loan servicer must send you a notice prior to commencing the eviction. Commonly called a Notice to Quit, this notice will give you a certain amount of time (for example, three days) to vacate the property. Generally, it is best to leave the property prior to the expiration of this time period, before the formal eviction action is started. (You can learn more about eviction in our Evictions and Terminations area.)
For more information about foreclosure timelines, procedures, and eviction in your state and in your particular situation, talk to a local foreclosure attorney.