What to Expect Once You Decide to Let Your Foreclosure Proceed

If you don’t fight your foreclosure or take any steps to work out an alternative, the foreclosure will move forward on a schedule dictated by your loan servicer's workload and policies, and federal and state law. (The loan servicer is the company that handles your mortgage account, which includes overseeing foreclosures.)

You Don't Have to Leave Right Away

The single most important point to understand is that you don’t have to leave your house just because you're behind in payments or because the servicer has started foreclosure proceedings. In most states, you’ll probably be able to stay long enough to plan for the future by saving all or some of the money that you’re no longer putting toward the mortgage.

Example. Joshua and Ellen got in over their heads and now can’t afford the $3,000 monthly payment on their mortgage. They decide to let the house go. They already know that federal mortgage servicing law requires the servicer to wait at least 120 days after they quit making payments before officially starting the foreclosure. They then consult with a local foreclosure attorney to see how much more time they have. They learn that:

Altogether, they will have about a year of living in the house without making payments, and if they can save at least $2,000 a month, they will have roughly $25,000 in the bank when they set out to seek new shelter.

How Long You'll Get to Stay In the Home

How much time you’ll get to remain in your house depends on many factors, including:

• whether the foreclosure is judicial or nonjudicial (judicial foreclosures usually take longer than nonjudicial ones)
• whether you get the right to participate in foreclosure mediation, which might prolong the process
• whether you get the right to live in the home during a post-sale redemption period, if there is one, after the foreclosure sale, and
• whether part of your strategy involves filing for bankruptcy before the foreclosure sale, which provides an additional two to three months’ delay.

Getting Help

To find out approximately how long you can remain in your home in a foreclosure in your state and in your situation, consider talking to a foreclosure attorney or a HUD-approved housing counselor.