Any homeowner in Wisconsin must understand the foreclosure process. If you are behind on your mortgage payments, you may have to end up giving your house back to the bank. Of course, no homeowner wants to be forced into foreclosing where they risk losing their home. The property you live in is not just bricks and mortar. You have invested time, effort, and resources to make a house into a home.
However, life is uncertain, and unforeseen events can affect us all. You could have become unemployed, had to pay enormous medical bills, or be going through a family crisis. If you get into financial difficulty, you need to take quick action to avoid the harmful effects of foreclosure in Kenosha-Racine.
When a bank or mortgage lender forecloses on your home, it can affect you in the following ways:
- You need to find a new place to stay
- Your credit rating takes a significant hit
- Foreclosure can affect your mental well-being
No one wants to give their house back to the bank. However, the good news is that you may not have to. If you act quickly, there are solutions to avoid foreclosure. In fact, the key to preventing the bank from repossessing your home is to act immediately—today. In many cases, foreclosure is the result of leaving it “too late.”
What is Foreclosure in Wisconsin?
Foreclosure is a legal process where the bank or mortgage lender takes possession of the property that was used to secure the loan. This most common reason for foreclosure in Wisconsin—or any part of the country—is non-payment of the loan.
Going through a foreclosure can be a nightmare. After all, it’s the last resort that lenders take to recoup their investment. Foreclosure usually happens at the end of months of negotiations.
But when you know how the foreclosure process in Wisconsin works, it is easier to navigate. You get the crucial knowledge and facts to ensure the end result is as pain-free as possible.
The Basic Stages of a Foreclosure
Most foreclosure processes are made up of several stages. Each state in the country has specific laws governing the foreclosure process. Here in this article, we’ll look at two that methods most states use to foreclose on a property:
- Judicial sale
- Power of sale
If you’re currently facing the threat of foreclosure, reach out to us by calling 262-228-8505 or filling out the easy form on our website. We can help walk you through the process and answer any questions you have about the foreclosure process here locally in Kenosha-Racine, Wisconsin.
Usually, the lender initiates a foreclosure process when you’ve missed three to six months of mortgage payments. In most cases—but not all—the lender sends multiple notices that you are in arrears. So, before the foreclosure process starts, and the bank takes back the house, there is a long paper trail of missed payments.
What Happens Under Judicial Foreclosure?
Judicial foreclose is when the lender goes through the courts, with the end result being that the property gets sold to pay the debt. This sale of property usually happens in an auction. Here are the steps involved in a judicial foreclosure in Wisconsin:
- The mortgage lender or bank files a suit in the local court.
- The court sends you a letter demanding payment.
- If the loan is valid, you have 30 days to come up with the payment—at this point, you can avoid foreclosure.
- If you can’t make the necessary payments, the lender can direct that your property gets sold.
- When the property is sold, you will be served with an eviction notice, and you have to vacate the property immediately.
What Happens Under Power of Sale?
Also called a non-judicial foreclosure, a power of sale doesn’t involve the courts. Here is what happens:
- The lender serves you papers directly demanding payment. Although the courts are not yet involved, the matter is still subject to judicial review.
- If you can’t make the payment, a deed of trust is drawn up, and a trustee takes control of your property.
- The trustee sells the property.
Foreclosures under the power of sale are not available in Wisconsin.
What Happens After a Foreclosure Auction?
Foreclosed properties in Wisconsin are auctioned off to the highest bidder. The lender hopes that the sale of the house covers the remaining balance on the loan. However, what if the house doesn’t sell for as much as the lender needs to cover the debt?
In those cases, the lender issues a deficiency judgment against you. This judgment means that you are required to come up with the remaining cash to cover the debt. Each state has different laws when it comes to the amount a deficiency judgment can be. You can find out here what rules apply to the foreclosure process in Wisconsin.
Avoiding Foreclosure in Wisconsin
Generally, it is best to do everything you can to avoid your house being sold at auction. Foreclosure hits your credit rating hard, and it can take years to recover.
That is why folks in Kenosha-Racine who are threatened with foreclosure work with experienced real estate firms such as At Home Buyers. We can help you negotiate discounts on the amount owed. Experienced investors negotiate directly with banks to reduce the amount you owe. In many cases, this can help you avoid foreclosure.
We are here to help you if you need to sell a property near Kenosha-Racine. If you need to sell your house for cash fast, reach out to us using the information below.
Give us a call anytime 262-228-8505 or
fill out the form on this website today! >>
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