Many homeowners are struggling paying all of their monthly expenses and are wondering to themselves “what will happen if I stop paying my monthly mortgage payments?”
First off before we begin, I must say that if you just stop paying your mortgage payments all together and do not try to resolve your mortgage struggles, your home will go into foreclosure. If your home forecloses, you will have to find another place for you and your family to reside.
The main factor as to how long and what type of process the foreclosure undergoes, will always depend on the state’s foreclosure laws. Different states will all pretty much choose there own way to foreclose, either it be done through the judicial or non-judicial process.
In many states the foreclosure law outlines that the process can be done through either manner. But in most states they choose to go through the non-judicial route. The reason why, is because this way takes much less time to complete and costs less for the lender as well.
Below is a brief definition of the judicial and non-judicial foreclosure process (laws may vary from state to state).
Judicial foreclosure: In order for the lender to foreclose using the judicial process they must first prove that the borrower has defaulted on their mortgage. To do this they must file a lawsuit with the local county court claiming the borrower has stopped making their payments. If the court agrees the foreclosure will proceed and the property will be sold on the date of sale set by the courts. This way of foreclosure is only used when their is no “power of sale clause” present in the borrowers original mortgage or deed of trust.
Non-Judicial: If there happens to be a power of sale present in the mortgage or deed of trust, the lender will go about the foreclosure using the non-judicial process. This route of foreclosure is the most commonly used method throughout the united states. The timeline of foreclosure and the amount of notices you recieve before the house sales will vary from state to state.
Generally you will recieve a notice letting you know about the past due amounts and giving you a certain amount of time to pay. This notice will also be listed in the local newspaper in which the home is located. If you do not bring the loan current or try to resolve the issue, the foreclosure process will then begin. At this time the lender will now set up a Trustee’s sale date. The borrower will be sent this notice informing them of the date the house is due to sell. If the borrower did not attempt to bring their loan current in time, the home will go through foreclosure and sold as scheduled.
So if you quit paying your mortgage payments all together and do nothing to resolve the issue, your home will go into foreclosure and you will be forced to pack your belongings and move. However, you may be able to avoid the foreclosure completely if you; complete a loan modification, short sale, bring the loan current, or possibly even a deed in lieu of foreclosure.