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Foreclosure FAQs
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What is foreclosure?
In Florida, foreclosure is a judicial process where the mortgage company that owns your loan obtains a court order to sell or repossess your home due to non-payment.
I’ve been served with foreclosure papers. What should I do?
Contact an attorney experienced in foreclosure defense. Failure to respond timely to a foreclosure lawsuit may result in a default judgment and wreak havoc on your credit.
My mortgage is more than my house is worth. Can I just walk away from it?
For the reasons stated above, it’s generally a bad idea ignore a foreclosure action, even if you do not intend to keep your home. What’s more, in Florida, even after the bank takes your home and sells it at a public auction for less than the amount of the mortgage, it may file a new action in court to obtain a deficiency judgment against you to collect the difference.
What are my options if I am unable to make my existing mortgage payments?
If you wish to keep your home, you may apply for a loan modification under HAMP or another modification program offered by your bank. If you do not intend to keep the home, you may work out with the bank a short sale or deed in lieu of foreclosure.
Alternatively, you may be eligible for bankruptcy under either Chapter 7 or Chapter 13.
What is HAMP?
HAMP is a federal mortgage loan modification program under the Making Homes Affordable Act signed by President Obama in 2009. Generally, banks that have opted into this program are required to offer loan modification to borrowers if they have any income at all, even Social Security.
Who qualifies for a modification under HAMP?
In order to qualify for a home loan modification under HAMP, the borrower’s current mortgage payment must be more than 31% of his or her gross income.