There are a few types of foreclosure. The more common types of foreclosure are judicial sale foreclosure and power of sale foreclosure. The process of foreclosure of each state is different depending on the law of that particular state. The timeline for foreclosure is slightly different for each type of foreclosure. How and when a mortgage company can start the process of foreclosure are outlined in the mortgage documents. Understanding how foreclosure works can help you avoid foreclosure and get the appropriate foreclosures help before it is too late. Most of the time, the mortgage company starts the foreclosure process as soon as the homeowner misses many months of mortgage payments.

 

Judicial Foreclosure

Foreclosure by judicial sale is probably the most common foreclosure type. This type of foreclosure is available in every state and a lot of states do not have other types of foreclosure. The law governing the judicial foreclosure makes it necessary for the mortgage holder to seek the supervision of a court for the sale of a foreclosed property. The involvement of the court slows down the process so the homeowner will have some time to come up with ways to avoid foreclosure and seek the right foreclosure help.

 

Power of Sale Foreclosure

If your mortgage document or deed of trust contains the power of sale clause then your state allows the power of sale foreclosure. The power of sale clause allows the mortgage holder to do the foreclosure and sell your property without the court being involved. The foreclosure process under the Power of Sale rule is much faster than the Judicial foreclosure process. This law makes it more convenient for the mortgage holder to foreclose on homeowners in default.

The proceeds of the foreclosure sale go to the mortgage holders first, and then to other lien holders. Then if there is anything left of the proceeds, the homeowner may get what is left. The problem is that, in this bad real estate market, usually the sale proceeds are almost always much lower than the amount that the mortgage companies are owed so, not only the homeowner usually gets nothing, he or she can even be pursued for the remaining amount owed.

 

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