Foreclosure in Cambridge is the resolution secured lenders arrive at when a homeowner is unable to stay current with the mortgage or condominium fee payments for a given period of time.Because of the financial implications of a foreclosure in Cambridge, the first step a struggling borrower should follow would be to take advantage of the existing lender’s options that aim at assisting financially troubled debtors. Foreclosures most of the time benefit the creditors more than the borrower because chances of selling the property for lesser than what is owed are minimal as compared to the effects of foreclosure to a debtor.
Types of foreclosures
Foreclosures in Worcester can be of two kinds:
Judicial foreclosure
The judicial type of foreclosure needs the courts intervention to be finalized.The lender files a civil lawsuit against the borrower so as to obtain a court order to foreclose on his/her property. This process is acceptable in most states and is highly applicable where the power of sale clause is not present in the mortgage contract or in the deed of trust.
Non-judicial foreclosure
This foreclosure does not require the intervention of the court as this is dismissed by the presence of the power of sale clause in the mortgage agreement or the deed of trust. Power of sale denotes that the borrower in question preauthorized before signing the mortgage contract, giving the lender the go ahead to sell the property in order to recoup what you owe to them in case you default.This power of sale therefore can be exercised by the lender or their trustee.
Power of sale guidelines in Worcester
Where the power of sale is included in the deed of trust or the mortgage, the date, place and terms of sale are specified and the following procedure should be adhered to:
- A notice of saleshould be served to the debtor in default to his last known address at least 20days prior to the foreclosure date and also this notice is also to be published on the print media in this case the county newspaper.
- The sale is to be conducted by the trustee at a public auction for cash to the highest bidder, anyone is welcome to bid inclusive of the lender and should the lender be the winner the borrower will have 12months to redeem the home.
Foreclosures as an investment in Worcester
Foreclosures can be treated as an investment opportunity as they are usually sold for lesser amount than the current market value so as to attract the market due the urgencies as most lenders want to get the properties off their books. The investor stands to get financial gains due the discount offered and with a few home upgrades the value of the home will appreciate. However there still maybe a chance that the disadvantages of buying a distressed home may outweigh the benefits thus thorough due diligence should be carried out when considering foreclosures as an investment in Worcester so as to avoid inherited burdens such as debts connected to the home, unpaid tax obligations, construction loans or home equity lines of credit among other issues
Sources
www.cambridgema.gov/CDD/housing/forhomeowners/foreclosureassisstance
www.homefinder.com/research/buying-a-foreclosure-72id