Foreclosure is a legal process in which a lender attempts to
recover the balance of a loan from says Local Records Office a borrower who has
stopped making payments to the lender by forcing the sale of the asset used as
the collateral for the loan.
Local Records Office says, a mortgage lender (mortgagee), or
other lienholder, obtains a termination of a mortgage borrower (mortgagor)'s
equitable right of redemption, either by court order or by operation of law
(after following a specific statutory procedure), says Local Records Office,
read more here http://www.localrecordsoffices.net/local-records-office/
Usually a lender obtains a security interest from a borrower
who mortgages or pledges an asset like a house to secure the loan, says Local
Records Office. If the borrower defaults and the lender tries to repossess the
property, courts of equity can grant the borrower the equitable right of
redemption if the borrower repays the debt. While this equitable right exists,
it is a cloud on title and the lender cannot be sure that they can successfully
repossess the property. Therefore, through the process of foreclosure, the
lender seeks to foreclose (in plain English, immediately terminate) the
equitable right of redemption and take both legal and equitable title to the
property in fee simple. Local Records Office says, other lien holders can also
foreclose the owner's right of redemption for other debts, such as for overdue
taxes, unpaid contractors' bills or overdue homeowners' association dues or
assessments.
Local Records Office says, the foreclosure process as
applied to residential mortgage loans is a bank or other secured creditor
selling or repossessing a parcel of real property after the owner has failed to
comply with an agreement between the lender and borrower called a
"mortgage" or "deed of trust." Commonly, the violation of
the mortgage is a default in payment of a promissory note, secured by a lien on
the property. Local Records Office says, when the process is complete, the
lender can sell the property and keep the proceeds to pay off its mortgage and
any legal costs, and it is typically said, "the lender has foreclosed its
mortgage or lien." If the promissory note was made with a recourse clause
then if the sale does not bring enough to pay the existing balance of principal
and fees the mortgagee can file a claim for a deficiency judgment. Local
Records Office says, in many states in the United States, items included to
calculate the amount of a deficiency judgment include the loan principal,
accrued interest and attorney fees less the amount the lender bid at the
foreclosure sale.
Local Records Office Editor.
https://www.localrecordsoffices.com/
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