Losing your home by foreclosures can be devastating. When you face financial problems, your home’s loss can be a brutal blow to you at that time. Unfortunately, many people experience these foreclosure sales.
People sell their property to recover some money that they owe on the debt. Although it is scary to have your home traded at foreclosure, you still have some options left.
Suppose you recently lost your house, and the sale already happens; you might be able to invalidate or reverse the deal. However, you can still get your property back by the right of redemption.
Can I Reverse a Foreclosure Sale?
Yes, you can reverse a foreclosure sale. This battle can drain your energy, but it is worth it if you get your home back. The process of foreclosure sale depends on judicial and non-judicial foreclosure.
In judicial foreclosure, the owner impounds property through the state judicial system. In this system, a homeowner may claim wrongful foreclosure in an unsettled court case.
In a non-judicial foreclosure, the lender files a case in state court to track the annulment of a foreclosure sale.
Some of the specific circumstances permit the nullification of a foreclosure sale. Generally, if you want to make this happen, the lender must show some proof. For instance, any irregularity in the foreclosure process that exhibits the sale void.
Alternatively, the owner claims that the lender failed to follow the terms of the mortgage. Therefore, it needs a review of the mortgage terms. The borrower has the contractual rights that the owner must honor.
For example, the lender must send a breach notice to the borrower. This notice grants a 30-day window to cure a default before initiating a foreclosure process. If the lender can not do so, then the borrower may request to reverse a foreclosure sale.
You can also let a foreclosure sale get reversed if the sale price was not so high that it would “shock the morals.”
While managing a foreclosure, you should know the redemption period available in your state. Many states give redemption periods that let homeowners get their homes back even after completing the auction.
With this option, you can pay the money that you owe on the debt and interest too. Once you make payment, you can get your house back from a person who bought it at auction.
Each state of the US has specific laws about the occurrence of redemption. Some of the states do not permit any redemption period. If you live in those states, you can not redeem the property after the auction.
If you reside in a state that approves reversal, the time limit of the reversal process can vary significantly.
You can stop foreclosure sales through legal avenues. If an owner files for bankruptcy, it will automatically cancel. Then, a bankruptcy court judge will rule on the validity of your home loan debt and decide whether the foreclosure sale should continue or not.
Homeowners can also file a petition to the local superior court requesting a temporary restraining order to terminate the sale. After petitioning, the homeowner needs to prove his case to the court, potentially resulting in the ban against the foreclosure sale.
In both cases, these methods, the homeowner can not do much more than a temporary halt from the foreclosure process.
Although there are some options to get a foreclosure sale reversed, it is best to find a solution before the foreclosure sale. For instance, many lenders can provide a forbearance plan or loan modification before foreclosing your property.
You can even get to refinance your loan and avoid foreclosure.