Foreclosure Requirements

General Legal Requirements Banks Must Follow for Mortgage Foreclosure
When a lender is pursuing the option of foreclosure, a borrower still has certain civil rights that must be met under the law. Lenders are obligated to meet certain due process requirements as provided by the U.S. Constitution and state statutes. Before a lender can repossess a property. Here are some of the general legal requirements that every lender must follow in order to maintain a foreclosure action against a homeowner.

Notice of Default -  Borrowers should be aware that they must receive a notice of default from a lender. Some borrowers may be under the impression that missing just one payment will immediately place a home into foreclosure. Under the law, this is inaccurate. Borrowers are entitled to first receive a written paper indicating default of loan provisions. In judicial states, borrowers will then have months to wait before the judicial process of foreclosure begins. Homeowners should be aware that a process server will deliver this written notice to them. A homeowner will not receive a notice of default in the mail.

Right to Cure Notices -  A borrower should check his or her state statutes to find out the period of time that lenders must provide within right to cure notices. In a right to cure notice, a borrower is given a specific period of time to attempt to repay a loan obligation. There are certain legal requirements that a lender must include in a right to cure notice. These legal requirements include an explanation of the non-performance of loan terms. The letter must also outline which steps a borrower must take in order to fix the problem. The amount required to satisfy the loan obligation must also be stated in the right to cure notice. Lastly, a lender must explain the options that it may pursue against a borrower in the event that continued default occurs.

Filing of an Eviction Claim -  If a homeowner continues to live on a property after the sale, then an eviction claim must be filed with the court. The lender may not use unlawful force to try to get the homeowner out of the property.