Foreclosure and Loan Modification
Bankruptcy can stop a foreclosure, but not forever. I can advise you about the foreclosure
process and help you
make those decisions that affect your mortgage and your property. I have
saved many of my clients' homes from foreclosure, occasionally through a
combination of loan modification and bankruptcy. The Bankruptcy Court for
the Northern District of California has a
Mortgage Modification Mediation process. If our attorneys can make a
determination that you might qualify for home loan modification, we can put you
into this mediation program. Under this program, we work directly with the
lender through a mediator to get your loan modified. In other instances, my
clients have saved tens of thousands of dollars in tax consequences or
deficiency debt by surrendering real property in bankruptcy. The key is
evaluating your realistic goals early on, before potential options have been
The "Foreclosure Spectrum."
The following steps occur in this order when you fall behind on your mortgage
payments. If you are behind on your mortgage payments, or are in danger of
doing so, then you should seek help. There may be options available to you
that your bank will never volunteer.
Step 1. Notice to Cure and Intention to Accelerate
|Typically a letter from your bank informing you that you are
behind on your payments. This is a demand for payment.
|You are typically behind 1 to 3 payments. Sometimes more.
|This is a debt-collection attempt.
|The lender may be demanding "full payment" of the entire note.|
Step 2. Notice of Default and Election to Sell Under Deed of Trust
|This notice is recorded with the Country Recorder.
|This is a public record.
|This may be accompanied with a "Notice of Substitution of
Trustee." The substituted trustee is the entity that has been
hired to carry out the sale.
|From this point, you have a minimum of 90 days until a Notice of
Trustee's Sale will be recorded.|
Step 3. Notice of Trustee's Sale
|At least 3 months have passed since a Notice of Default was recorded.
|This is a public document, recorded at the Recorder's Office.
|Sale is set for 20 or more days from the notice.|
Step 4. Trustee's Sale
|Also known as a "foreclosure sale."
|This sale occurs on the "courthouse steps."
|Approved buyers bid in an auction-form buying process.|
A Bankruptcy petition can halt a trustee sale - but you
have to file before the trustee sale date and time. If you waited until past this point, then your property has been sold.
In order to keep your house, you will need to "reinstate" your
mortgage, and that is very unlikely (depending on your individual, unique
circumstances). If you are unable to reinstate your mortgage, then a
bankruptcy petition can stall and delay eviction proceedings.
Step 5. Notice to Quit
|Also known as an "Eviction Notice."
|At the point, the purchaser of the Deed of Trust for your home has
recorded their deed.
|You have 3 days to vacate your home or face further civil proceedings.|
Step 6. Unlawful Detainer
|Also known as "Eviction."
|This is a lawsuit against you.
|You will receive a "Summons and Complaint" from a process
server. This is an accelerated process, and the trial date will be set
within 21 days of the day you receive the Complaint.
|Upon receipt of the Complaint, you have 5 days to "Answer."
An Answer is a legal filing that outlines your defenses to eviction.|
|You MAY be able to stall the eviction process by filing bankruptcy, but
you need to contact an attorney before it's too late. Get help sooner rather
Step 7. Lockout by Sheriff
|The Sheriff will post on the property a "5 Day Notice to
|On or after the 5th Day, you will be locked out of the house.|
In order to assess your situation with regard to foreclosure defense or
mortgage modification, I only meet with
clients in a foreclosure situation in person and I do not offer legal advice
over the telephone. The initial consultation typically lasts about 45
minutes and you have the opportunity to discuss your unique circumstances with
an attorney who has experience with foreclosure defense and the application
process for a loan modification. There charge for this consultation is
$150 and is based on a reduced rate of the attorney's hourly rate.