Pre-Foreclosure 101: Need-To-Know Timeline
- Nov 7, 2023
- 3 min read
If you are facing foreclosure, it is MOST important to know the timeline of events.
This timeline is ensured by both Federal and State statutes, and understanding the process makes it much easier for the borrower to make a plan.
Remember that no matter which point in the foreclosure process the borrower is facing (including up to 10 days past the county auction), there are viable options to avoid foreclosure.
Day 1: Miss First Monthly Payment
(It’s really OK, we all know that sh*% happens)
Know the date of your first missed payment - very important
This is the date your bank will use to begin the foreclosure process, this starts the "Loss Mitigation Period."
What is a Loss Mitigation Period?
Begins the date of 1st missed payment. The Bank has to wait between 90 and 120 days before starting official foreclosure process. (12 CFR § 1024.41)
The bank must attempt to work with the borrower during this period of time. It is best to communicate with the lender during this period, even if you cannot make any type of payment arrangement (refinance, loan modification, etc).
The Bank is able to officially start foreclosure after 90 days, if there is NO communication from borrower. If, on the other hand, the borrower makes an attempt at 'resolving' the missed payment the bank cannot file official documents until the loan is 120 days delinquent.
Day 90-120: Notice of Default
(Usually sent via U.S. Mail)
Notifies the borrower that the Lender will be filing an official civil complaint in the Florida county where the property exists, beginning the foreclosure process.
You can expect this notice to arrive very shortly after 90-120 day loss mitigation period ends. Most times the Notice will be dated within the same week.
A notice of default to the borrow means that the bank will imminently file a Lis Pendens "Pending Suit" with your County's court.
Lis Pendens is filed, indicating that there is pending litigation regarding delinquency
Notice is served to borrower by County Sheriff
**The Borrower has 20 days from this notice to respond to the pending suit filed**
No Response From Borrower = Shorter Foreclosure Process
Response From Borrower = Longer Foreclosure Process
If/When the court receives a response from the borrower, the date for a hearing must be scheduled with enough time for the borrower to prepare. If the court does not hear from the borrower, there is not as much time needed for the Judge to rule, as there is no opposing argument.
Day 110-140: Motion for Summary Judgement
After 20 business days - lender will petition the court to make a decision (Judgment).
Court will set a date for this hearing (gives you more time and depends on County docket)
Borrower is encouraged to attend and defend position.
Final Judgment
If the judge finds in favor of the lender, a foreclosure auction date will be scheduled
Florida State Statute dictates sale to be scheduled between 20-35 days from final judgment summary
Day 150+: Auction Schedule
Once the auction date is scheduled, the borrower can still request a delay, especially if there is a pending sale, probate issue, or possible payoff.
Many times the auction date gets pushed due to the County schedule, but at this point the borrower should not wait for that possibility, as it is not ensured.
Believe it or not, the County does not want to Auction off the property, there are many possible reasons the borrower could file for an extension.
Contact me NOW if you are at this point in the process!
If you want at least three good options to avoid ruining your credit and preserving your property's equity, read part II...