Uncontrollable circumstances may cause you to delay your mortgage payments. However, missing several mortgage payments is unacceptable and may leave you at the risk of foreclosure. Interestingly, foreclosures in Birmingham can occur in unexpected and sometimes surprising ways.
How Does Foreclosure Work?
You could either buy your home as a cash buyer or do so on a mortgage. If you purchased your home with lender services, you must have signed a mortgage contract that specifies the total debt incurred, your monthly installments, and the interest rate. Hence, you’re expected to follow through with the terms of this contract and make the necessary payments before or as due. If you fall behind on your monthly payments without proper communication with your lender or miss several payments, the bank or lender can foreclose on your property. In other words, they may sell your property to make back their money.
Steps in Foreclosure
- Missed Mortgage Payments
- Default Notice
- Preforeclosure
- Notice of Sale
- Eviction
Technically, despite occupying the property, you do not own it until you’ve cleared the mortgage.
Types of Foreclosure
There are three major types of foreclosures:
- Judicial Foreclosure
In a judicial foreclosure, the lender files a lawsuit following missed payments. The homeowner is then notified and given 30 days to make the missed payments, or else the foreclosure process proceeds.
- Non-judicial foreclosure
Non-judicial foreclosure is very similar to its judicial counterpart. However, it doesn’t go through a court. The homeowner receives a notice of the missed payments and gets a 30-day window to pay or have the property sold.
- Strict foreclosure
This type of foreclosure is uncommon in most states. In a strict foreclosure process, the lender files a lawsuit, and the homeowner has a timeframe of 30 days to make up for the missed payments. If this is not done, the property is seized rather than sold by the lender.
Causes of Foreclosures In Birmingham
Variable loan rates
Birmingham Foreclosures sometimes occur because of the flexibility of loan rates. Many homeowners are attracted by the low payment and interest rate offered by the lender, only to be surprised by a rise in interest rates. Consequently, this increases costs and sometimes results in outrageous debts.
Divorce
Emotional pressure and relationship strains may be overwhelming, causing attention to shift from the mortgage payment. This may result in missing several payments and eventually cause a foreclosure.
Sudden Relocation
Most homeowners relocate after careful and deliberate planning, but life sometimes comes with surprises. You may have to relocate urgently for your job or other personal reasons. While buying a home may be relatively easy with the help of a realtor, selling your house in Birmingham isn’t that straightforward. Thus, you’re in a scenario where you have to pay two mortgages. This could become unbearable and ultimately bring about foreclosure.
If you find yourself in a situation like this and need a fast way to sell your property in Alabama to avoid foreclosure, contact Rhed Key. With RHED Key Properties, you get the best cash offer in the shortest possible time.
Credit card debt
Most people have debts on their credit cards. When these debts accumulate, and there is a limited income inflow, they often have to choose between their credit card payment and their mortgage payment.
Natural Disasters
Natural disasters often bring about physical and economic damage.
Best Way to Sell My Home in Alabama
Perhaps you’ve listed your property for Birmingham home sales and have received some cash home offers in Alabama. But, these cash offers understate your home’s value. Rhed Key got you covered. We buy houses in Birmingham fast for cash at highly competitive prices.
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