Does a Notice of Default Mean You Will Lose Your Home?
By admin | December 21, 2009
With the current troubled world economy, many people are worried that, with the rising costs of everything from fuel to food to clothes, they may not be able to make ends meet. And even with overtime (something that companies, themselves are scaling back on), it can be quite tough. But what happens if you get a notice of default? Does this mean that you’re about to lose your home?
Despite, what you may read elsewhere, this is not the end but rather a “wake up call.” A notice of default is simply your lender telling you what payments on your mortgage you have missed, the amount owing and the legal costs of getting the notice prepared.
The official definition, for those interested, is: “a notice to a borrower with property as security under a mortgage or deed of trust that he/she is delinquent in payments. If the delinquency (money owed and late), plus costs of preparing the legal papers for the default, is not paid within a certain time, foreclosure proceedings may be commenced. Other people with funds secured by the same property are usually entitled to receive copies of the notice of default.”
So, in plain language, what does this mean for someone receiving this type of letter? It is the first step and an attempt by the lender to give you a chance to catch up on your payments, work out a payment schedule, or meet with them to try and make a change in the terms of the loan (also called a loan modification).
The very worst thing you can do is ignore it. Take it seriously; as if the lender does not hear from you, they may begin foreclosure proceedings. If you take a notice of default seriously, and hire an attorney, then you will find that you will keep your home.
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