What is the law on a repossession of a home?

Answer

It depends on the state. Here in Utah, the mortgage company notifies you with a notice of default. This is when you haven't paid the mortgage, or are short on payment for a pre-determined amount of time, this will be in the docs signed when you got the mortgage. (It can vary from company to company, but is usually about 3 months.)

After you receive a notice of default, you have 3 months to either come current or sell the property. After the three months, you receive a notice that the property will be sold to recover the debt. In this state, the property is then siezed by the mortgage company and you are asked to leave, or forcibly evicted. The property then goes through an evaluation process to see if it will bring the amount needed. Then there is a period, usually simultaneously, of public notification of intenet to sell, then the property to auctioned off to the highest bidder (usually the mortgage company itself). If for some reason, the bank cannot re-coupe its losses, you may be responsible for a deficiency and the bank can get judgement against you. In the state of Utah, even a bankruptcy cannot protect you against foreclosure and deficiency, you cannot declare bk on real property in this state.

Your best bet is to try to sell the home at this point.If you have received a notice of default and cannot come current, please don't try to sell the home yourself, notify a real estate agent. They will be able to work with the bank on a short sale and possibly avoid the auction of the home. One thing to think about is that if the house forcloses, this will stay on your credit report forever. If you can do a short sale, the deed will record as paid in full.

Again, DO NOT try to sell the home yourself, get an agent to do it for you, they know the laws and regulations of your state and are better equipped to work with the lender than you are.

First answer by anonymous. Last edit by layna. Question popularity: 105 [recommend question]