A brief guide to foreclosure attorneys
If you are a homeowner battling financial difficulties, at some point you may face the threat of foreclosure. A creditor may try to take your property away from you to settle a debt. When this happens, a lawyer can help you try to retain your property and work out a financial agreement with your creditor. Here are a few important things to consider if you think you may need to hire a foreclosure attorney.
How foreclosure works
Many people cannot afford to pay all at once for any apartment or house they purchase. Commonly, they enter into a mortgage agreement, in which they receive a loan they must pay back, with the property as security. If you fall behind on your payments, your lender may try to for you to sell your property to pay your debt. Such arrangements are often made with banks.
There are two different kinds of foreclosure:
• In a “strict foreclosure,” the debtor loses his or her rights to continue trying to pay off the debt and their property is auctioned off
• In a regular foreclosure, the lender sues the debtor in state court. If a ruling is found in favor of the lender, the property is auctioned by the county.
Foreclosure attorneys help craft strategies for both lender and debtor. While debt may appear to be a simple problem, there are many different ways it can be handled.
Your options during foreclosure
There are many possible options to take if you are faced with the threat of foreclosure. Some of these include:
• Refinancing your loan. Often, this means renewing your debt with a longer payment plan, lower interest rate or other adjustment to your previous agreement that allows you to keep paying off your lender.
• Short sales, in which you sell off your property to cover as much as possible of your debt. This helps avoid prolonged expensive court proceedings requiring the use of foreclosure attorneys but will leave the lender with part of the debt unpaid and the debtor with a negative credit rating.
• Filing for bankruptcy. This is the most extreme step you can take in response to foreclosure but can afford you a fresh financial start.
What foreclosure attorneys do
As with any legal matters related to business, the foreclosure process relies upon extensive documentation and being mindful of often complicated technical procedures. At each step, a foreclosure attorney advises you what your best course of action are and negotiates on your behalf.
It is possible to resolve the foreclosure process without appearing in state court. In many cases, debtors may be offered new terms for their bad debts by the institution in question. As soon as you are aware that you may fall behind on your payments, notify your lender. There may still be time to find an agreement that can prevent you from facing the loss of your home.
If you are already in foreclosure proceedings, having the advice of a lawyer can be helpful. For many people, it may be an expensive or impossible option. Those unable to afford private legal representation should try to find a pro bono lawyer. Some government services also offer free legal advice.
In some cases, your foreclosure attorney may recommend declaring bankruptcy. The procedures for doing this are some of the most complex in the legal system. There are 90 bankruptcy courts in the country, each of which has its own special procedures and laws. Foreclosure attorneys are helpful when trying to figure out which federal, state and local laws apply to you, especially if you are trying to determine which parts of your property are exempt from confiscation. Bankruptcy temporarily stops all attempts to confiscate your property, though the lender can sue to proceed with collection regardless.
A foreclosure attorney can be helpful if you feel unlawful action is being taken against you. Definitions of harassment vary from state to state, but it is possible to halt some action. Debtors are often unaware of their rights when confronted with aggressive measures by their lenders.
How to look for a foreclosure attorney
If you’re facing the threat of losing your property, you have to act fast. This doesn’t mean you should commit to working with the first foreclosure attorney you meet with. Taking care in selecting your legal counsel now will prevent additional problems later.
When you become aware you are or may soon be facing the threat of losing your property, ask friends and family if they can recommend anyone specializing in the practice of foreclosure law. If no one you know can help refer you, your local or state bar associations can provide referrals, though you may often have to pay a small fee for this service.
At your first meeting with any lawyer, come with as much documentation as you have available on your finances. Foreclosure attorneys will be unable to provide reliable legal advice if they don’t have all the facts. In return, they should be prepared to answer any questions you have. During this initial meeting, ask about:
• Their honest opinion of what kind of resolution you can hope for
• Their level of experience and specialization in your kind of case
• What option they recommend to fight or forestall foreclosure
• How much their services will cost
At this financially testing moment in your life, the last thing you want to do is get involved with a foreclosure attorney who will add to your difficulties later on. If a lawyer’s promises to help you get rid of your debt seem too good to be true, this may well be the case. Get clear answers and estimations of your cost in writing before you commit to working with any foreclosure attorney. By creating a strong, open lawyer-client relationship at the outset, you can focus on keeping your property safe without worrying that you will be facing unreasonable fees later on or otherwise have your urgent need for legal counsel taken advantage of.