In California, once the notice of default has been recorded, you have approximately 120 days to save your home before it is auctioned. Once you get the notice in the mail don’t waste any time!
Here are 5 things to do immediately….
- Call your lender and ask them what solutions they have. Banks are moving away from foreclosures and new programs are coming along all the time. The best way to be sure you have the latest information is to call the lender. If you want to keep your home, begin the process under as many avenues as are available, including non-profit programs.
- Find out who owns your mortgage. Even if your loan is with BofA, it could be owned by Fannie Mae or Freddie Mac (Question #9 in FAQ), If it is, you may qualify for a government program and be able to refinance without an appraisal (HARP2), to modify your loan (HAMP), or to do short sale and get a cash incentive to help with relocation expenses. (HAFA).
- Get professional advice from your tax preparer and an attorney about your financial options and the effect a short sale would have on your finances.
- Operate on the 120 day timeline. This is the typical timeline from Notice of Default to foreclosure and then auction. In that 120 day period is your opportunity to a) get a loan modification consent from the bank, b) short sale your property, or c) find a way to bring your mortgage current.
- Contact a certified short sale Realtor, such as myself, if you want or need to sell your home. Get that ball rolling as soon as possible.
Until the Home Owner’s Bill of Rights takes effect on January 1, 2013, the banks are under no legal obligation to stop the foreclosure process, even if they have told you they would work with you on a loan modification.One last thing: That Notice of Default you got; it is public record. So, put your guard up regarding people who may try to contact you. Some of them may be legitimate, but some may be working a scam.