Have you been unable to keep up with your mortgage payments and are worried your lender will repossess your home? Depending on your lender’s policy, the number of missed installments you may have before a foreclosure action gets filed can vary widely.
Don’t lose hope. There may be options to avoid losing your home depending on your financial circumstances and loan agreement.
What Happens After the Missed Payment Grace Period?
Typically, there is a 15-day grace period that Florida lenders give their customers to catch up on missed payments. The clock starts rolling from the day it’s due and, once passed, will penalize you with a late fee. This charge will continue to recur every month you are late, so make sure to include that fee with your payment as soon as possible.
What if Your Mortgage Gets a Month Behind?
Once your account is a month behind, meaning you’ve missed one payment, your lender will contact you. Often they want to know what has changed in your financial situation, and may even have in-house programs to help you get back on track. So it’s important to be honest about why you fell behind.
Federal law requires lenders to reach out to you about your delinquency, and it’s also possible they will report your missed payment to the credit bureaus at this point.
What Happens at 45 Days Past Due?
Once you’re a month and a half behind, your lender will appoint a team member to assist you in loss mitigation efforts. This means they will actively try to help you in hopes of avoiding foreclosure on your home. Typically, they have a month to evaluate your circumstances and determine any mitigation options you qualify for.
The representative assigned to your case will help you with a variety of things, including:
- Sharing any available loss mitigation programs that are available
- Going over steps you need to complete for a loss mitigation application
- Keeping you up-to-date on the status of your application
- Reviewing steps you can take to appeal a denial
When You are 90-Days Delinquent on Mortgage Payments
Most South Florida lenders send a breach letter when homeowners are 90-days delinquent on their mortgage payments. This letter is the last reminder that your mortgage is in default and outlines the different avenues available to resolve your situation. It also gives you a final due date to cure the issue, and that failing to do so could result in their filing a foreclosure action against you.
When you receive this letter, it’s your last opportunity to avoid going to court. However, do not ignore this or any of the previous efforts by your bank to resolve your delinquent payments. Instead, contact them right away to find out if a repayment plan, refinancing, or forbearance is possible for your case.
Loss Mitigation Ends at Four Months of Delinquency
South Florida lenders can pursue a foreclosure suit at the 120-day mark of being past due. This timeline is outlined in the Dodd-Frank Act and by the Consumer Financial Protection Bureau. The only way to extend this period is to file a loss mitigation application and have it approved.
What Happens When a South Florida Lender Files a Foreclosure Action?
When you fail to catch up on missed payments or are unsuccessful in obtaining an extension, your lender can move forward with filing a foreclosure suit at the 120-day mark. They are legally required to serve you a Notice of Default and Complaint once filed with the court. You will have 20 days to answer (respond) to this action, and failing to do so could result in a default judgment for the bank.
This is why having a highly qualified South Florida foreclosure defense attorney by your side from the moment you can’t make your payments is essential. Default judgments are challenging to appeal, which is why loss mitigation is so important.
Speak with a Trusted Foreclosure Defense Attorney Today
If you or someone you know can’t keep up with their house payments and is scared about foreclosure proceedings, you need aggressive legal representation and high-quality legal services. After representing Florida lenders throughout South Florida for over a decade, Attorney Marc Brown has the insight and skill you need to avoid or resolve your foreclosure situation. Schedule a no-cost legal consultation with the law firm of Marc Brown, P.A., today by calling.