Kentucky Foreclosure Lawyer
Our Kentucky Foreclosure Lawyer Can Help If You Are Faced With Foreclosure On Your Home
As of spring 2016, there were over 886,000 properties across the U.S. in foreclosure. Nationally, the number of properties that received a foreclosure filing in March increased by 11 percent from February, for an average of 1 in every 1,212 properties. Here in the Bluegrass State, the number of properties that received a foreclosure filing in March was unchanged from the prior month, at 1 in every 2,362, but was 31 percent higher than the same time period in 2015.
Each state has its own laws that lay out the mandatory process a lender must follow to collect on a debt that a borrower has failed to pay, including giving adequate notice, offering opportunity to make the loan current, and sale of the property. Some states do not require the lender to go to court in order to foreclose, but since Kentucky is a judicial foreclosure state, the lender must file a lawsuit to get the foreclosure started.
The Lexington, KY, homeowner foreclosure lawyers at Bunch & Brock have extensive experience representing clients who have fallen behind on mortgage payments or are facing foreclosure. We have over 35 years of experience advising people throughout Kentucky about how to best address their situation and helping them make the most informed decisions for their circumstances. If you believe that you are facing an imminent threat of foreclosure, you may have more options and protections than you think.
Learn more about your borrower rights under the law during a confidential consultation with our skilled legal team. Call us today at 859-254-5522.
What Does Our Foreclosure Attorney Do to Help You?
Being faced with foreclosure is extremely unpleasant. Besides the fear you feel at the prospect of losing your home, you are probably dealing with threatening letters, emails, and calls from the lender.
If you want to save your home, this is not something you should deal with on your own. Our Kentucky foreclosure attorneys can examine your individual situation and find the options that would work best for you. We can:
- Use federal and state law to your advantage and to find any protections you may have
- Handle all paperwork involved and make sure everything is filed correctly and in a timely manner
- Negotiate with the bank to restructure your mortgage payments and make them more affordable through loan modification
- File for bankruptcy on your behalf, if appropriate, to stop attempts at collection and prevent the bank from foreclosing on your home
- Help you sell your home through short sale and negotiate with the lender to waive any deficit.
How the Kentucky Foreclosure Process Works
Mortgages are complex documents, cluttered with clunky terms and ever-changing interest rates. Basically, a lender (the mortgagee) gives a loan (secured by the mortgage) to a borrower (the mortgagor). The borrower promises to pay the money back plus interest, but if the borrower fails to do so (defaults), the lender has the right to take the asset that was the reason for the loan (the collateral) and sell it in order to get the money back. The legal proceeding by the lender to end the borrower’s claim to the property is known as “foreclosure,” and works as follows:
- Collection efforts begin with a borrower’s first missed payment and are accompanied by a 30-day default letter if there is a second missed payment.
- Lenders can begin sending notices of their intent to foreclose 60 to 90 days past due, although the borrower retains the right to reinstate the mortgage (until the day of auction) by paying all past-due installments, fees, and interest. The lender has the right to refuse partial payments and, unless it receives payment in full, can file a foreclosure action.
- The borrower is personally served a summons by the sheriff and has 20 days to respond to the complaint. If the borrower does not respond, the lender may be granted a default judgment followed by an order of sale.
- Except in cases where property is found to be vacant and abandoned, the master commissioner of the circuit court is generally required to conduct the sale within 90 days of the court’s entry of the order of sale.
- Before a property can be sold at a foreclosure auction, the sheriff must post a notice of the sale at the courthouse, as well as at or near the subject property. Prior to January 1, 2016, notice had to be published once per week for three consecutive weeks in a newspaper of general circulation. Starting in 2016, the notice has been required to be published once, the week before the auction.
- Borrowers can stay in the property until the sale, as long as they are not destructive.
- Once the property is sold to the highest bidder, the foreclosure is official and the new owner can begin eviction proceedings or offer the borrower “cash for keys” to vacate if necessary.
- The lender may also buy the property and relist it for sale.
It is in everyone’s best interest for the lender to get the highest possible price at auction. If the sale price is more than what’s left on the mortgage, the borrower can keep the extra. If it’s less, the lender has the right to collect the deficiency on the judgment. The borrower is responsible for the difference between what the property sold for at auction and the amount of the original loan.
How Foreclosure Defense Lawyers Can Stop Foreclosure Through Bankruptcy
The most common types of consumer bankruptcy are Chapter 7 and Chapter 13. Once bankruptcy is filed, you receive an automatic stay, which will stop foreclosure on your home, as well as stopping lawsuits, garnishments, and harassing collection calls. The stay lasts only until the bankruptcy proceedings are complete, but it will eliminate many debts which may make it easier for you to pay your mortgage and keep your home.
Chapter 7 bankruptcy will eliminate many consumer debts. While your non-exempt property will be sold by a bankruptcy trustee to pay off your debt, there are federal and Kentucky exemption laws that can protect certain types of property, including your home.
Chapter 13 allows you to consolidate payments to repay some or all of your debt in affordable monthly payments over a three- to five-year period. If you can continue to make mortgage payments, you can keep your home rather than losing it to foreclosure.
What Happens After a COVID Mortgage Forbearance?
After a COVID mortgage forbearance, you have options for paying what you owe
During the COVID-19 pandemic, many struggling people have been able to get temporary relief from making monthly home loan payments through COVID mortgage forbearance. This allowed them to delay or reduce mortgage payments without facing foreclosure
To qualify for COVID mortgage forbearance, you needed to have experienced financial hardship because of the pandemic and have a federally backed loan, including HUD/FHA, VA, USDA, Fannie Mae, and Freddie Mac loans. Some private lenders also offered mortgage forbearance. Forbearance was not meant to go on indefinitely, and the extension of the deadline to request mortgage forbearance ended Sept. 30, 2021, with a maximum forbearance period of six months. When the allowed forbearance period is over, homeowners must start paying back what they owe.
Loan Modification After COVID Forbearance — Options for Paying Missed Mortgage Payments
There are several options for homeowners who face making up missed payments. Which one you use depends on the lender, whether your loan is federally backed, and what you can afford to do. Options include:
COVID Deferred Mortgage Payment
For loans federally backed by Fannie Mae or Freddie Mac, you may be eligible for a COVID-19 Payment Deferral or similar repayment plan, depending on your lender. After forbearance ends, you return to making regular mortgage payments for the same amount and interest rate you had pre-forbearance. Missed mortgage payments are added on to the end of your loan term and are paid back when the loan is refinanced, the house is sold, or the mortgage is paid off.
In a repayment plan, additional money is added to your regular monthly mortgage payments for set time periods to pay back what you owe. After the missed payments are paid back, monthly payments return to normal. Before signing anything when it comes to a repayment plan, be sure you can afford the extra money each month that you’ll be required to pay.
This involved restructuring your mortgage to reduce monthly payments and make them more affordable. This may change the length of your loan, your interest rate or other terms.
Lump Sum Payment
You pay your regular mortgage payment for the month, plus the total of everything you owe due to forbearance, in one single payment. Federally backed mortgage lenders cannot require missed forbearance payments to be repaid in a lump sum, but non-federally backed lenders may do so.
Our Attorneys Can Help You When Forbearance Ends
If you are having problems with making up missed payments after forbearance ends, contact our Bunch and Brock attorneys for help. We can make sure your lender is following the law, and we may be able to help you negotiate a better and more affordable option with your mortgage lender.
Call Our Foreclosure Lawyers for Help
If you are facing foreclosure in Kentucky, you have options. The foreclosure defense attorneys at Bunch & Brock understand the issues, know your legal rights, and will help you determine the best course of action for your situation. Your lender may have disregarded certain mandatory regulations, may not legally own the debt, or may have filed a wrongful foreclosure. Even if your lender did everything correctly, there are ways we can help.
Our Fayette County foreclosure attorneys are committed to providing each of our clients with a high level of personal service and knowledgeable representation.
Don’t delay. To schedule an initial consultation, please call 859-254-5522 today.