If you ever find yourself in a position where you are unable to keep up with mortgage payments and are facing the possibility of foreclosure on your home, it is vitally important to find out everything you can about homeowner rights on a foreclosure. When filing for a foreclosure, a lender must follow specific guidelines in order for that filing to be valid, and you yourself have certain options and rights regarding your home and property.
In order for the foreclosure process to begin, your lender must notify you in writing that they are going to take this step. Typically, a lender will not initiate foreclosure until about ninety days past the due date of the first missed payment. If a bank claims that you are in foreclosure, but you never received notification, it would probably be a good idea to involve your lawyer.
Once the foreclosure process is started, you can still attempt to negotiate with the bank. You also might be able to refinance your home, resulting in a loan that is easier for you to maintain. Another option is to put your house up for sale, either through a real estate agency or on your own. Selling through a Realtor adds additional complications, as Realtors must take a commission on the sale. Selling on your own is also difficult, though, so consider the implications before taking this step. It is also possible that you could simply return the house to the lender, although in this case you would lose any opportunity to claim money gained in an eventual sheriff sale.
In about half the states in the US, there is also a redemption period during which the owner can reclaim the house after the sheriff sale. If you can pay the amount determined by the sale as well as interest, you can reclaim the house. Another in the list of homeowner rights on a foreclosure is that if the sale price of the house is greater than the amount that must be paid back to the bank, that money belongs to you.