Understanding The Foreclosure Process In Lorton VA

understanding the foreclosure process in Lorton

The thought of foreclosure can be utterly unsettling, but not unavoidable. You can make the best of this bad situation by considering many existing foreclosure rescue options. If you’re dealing with the sleepless nights, the continued stress because of a lost job, or that you’re unable to pay your mortgage premiums, then you’ll certainly want to understand the full foreclosure process in its nitty gritty detail. Understanding the foreclosure process in Lorton is important. Working with a cash home buyer in Lorton VA such as The House Guys will provide an invaluable resource. Check out our latest blog post to learn more…

Understanding the Foreclosure Process in Lorton VA

What Is Foreclosure Anyway?

Foreclosure is the legal process that lenders use to take back property securing a loan, generally after the borrower stops making payments.

Foreclosure is no fun.  But just know that it’s not the end of the world.

When you know how foreclosure in Lorton works… it arms you with the knowledge to make sure you navigate it well and come out the other end as well as possible.

The Basic Stages Of A Foreclosure

There are a few stages that are important to any foreclosure process. Foreclosure works differently in different states around the country. The two ways different states foreclose upon a property are: judicial sale or power of sale.

In either scenario, foreclosure typically doesn’t go to court until 3-6 months of missed payments have elapsed. Usually (but not always), a lender will send out many notices that you are in arrears – overdue or behind in your payment. Check out this blog post if you want to know if you can sell your home during foreclosure.

Under Judicial Foreclosure

  • Your mortgage lender must file suit in the court system.
  • You’ll get a letter from the court demanding payment.
  • Assuming the loan is valid, you’ll have 30 days to bring payment to court to avoid foreclosure (and sometimes that can be extended).
  • If you don’t pay during the payment period, a judgment will be entered and the lender can request the sale of your property – usually through an auction.
  • Once the property is sold, the sheriff serves an eviction notice and forces you to immediately vacate the property.

Under Power Of Sale (Or Non-Judicial Foreclosure)

  • The mortgage lender serves you with papers demanding payment, and the courts are not required – although the process may be subject to judicial review.
  • After the established waiting period has elapsed, a deed of trust is drawn up and control of your property is transferred to a trustee.
  • The trustee can then sell your property to the lender at a public auction (notice must be given).

Anyone who has an interest in the property must be notified during either type of foreclosure. For example, any contractors or banks with liens against a foreclosed property are entitled to collect from the proceedings of an auction.

What Happens After A Foreclosure Auction In Lorton?

After a foreclosure is complete, the loan amount is paid off with the sale proceeds.

Sometimes, if the sale of the property at auction isn’t enough to pay off the loan, a deficiency judgment can be issued against the borrower. A deficiency judgment is where the bank gets a judgment against you, the borrower, for the remaining funds owed to the bank on the loan amount after the foreclosure sale. Some states limit the amount owed in a deficiency judgment to the fair value of the property at the time of sale, while other states will allow the full loan amount to be assessed against the borrower.

Here’s a great resource that lists the state by state deficiency judgment laws, since every state is different.

Generally, it’s best to avoid a foreclosure auction. Instead, call up the bank, call your local foreclosure lawyers, or work with a reputable real estate firm like us at The House Guys to help you negotiate discounts off the amount owed to avoid having to carry out a foreclosure. You may even be able to stay in your home after foreclosure if you start quickly.

Experienced investors can help you by negotiating directly with banks to lower the amount you owe in a sale – or even eliminate it, even if your home is worth less than you owe.

The House Guys Offer A Simpler Solution

If you think you need to sell your house in Virginia fast, then you may need an investor. The House Guys are local homebuyers in Lorton and we’re helping local homeowners solve their housing problems quick and hassle-free. We buy houses in Virginia and if your house in Lorton qualifies, we can make you a quick and fair cash offer. 

Andy Kolodgie

Andy Kolodgie is an experienced real estate investor in the Washington DC Metro area. As owner of The House Guys, Andy's goal is to provide home sellers with creative real estate options beyond the typical cash offer. He's been featured on multiple publications including Yahoo Finance, MSN, HomeLight, Credit.com, Apartment Therapy, Business.com, LegalZoom, Zolo, and Creditcards.com.

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