Foreclosure in Lowell is the legal process through which lending entities use to get payments outstanding from defaulting borrowers who due to some reasons have stopped keeping their side of the deal on the mortgage.It is possible to have more than one lender foreclosing on the property simultaneously.However, the primary holder or the first mortgagee is the one who receives payments prior to the others.
Types of foreclosures in Lowell
There are two types of foreclosures namely judicial and non-judicial foreclosures. Judicial is comprised of the sheriff sales which requires the property to be auctioned and sold to the highest bidder where the lender is to place the opening bid. Strict foreclosure is where the court sets a date by which the debtor is to make payments failure to which will be followed by a foreclosure. The non-judicial foreclosure in Lowell is the one that requires no court intervention to take place as the power of sale clause in the mortgage preauthorizes the sale of the property in the event that the borrower defaults.
Risks of foreclosure in Lowell to the borrower
Foreclosures are negative events to any borrower therefore it is highly advisable to seek immediate counseling from a house counselor and talking to your lender soon enough when you find yourself struggling with your debts or your mortgage payments. The risks can also be seen as disadvantages and they may include the following:
Youloseyourhome: if you have taken loan against your house or bought your house with a loan, and you have become delinquent over time upon the decision of your lender(s) to foreclose on your home, it will be very painful to lose your house especially where it was your primary residence.
Creditfallout: definitely if you are a victim of a foreclosure in Lowell, you will be regarded as high risk to most of the lenders hence even those willing to offer you credit it will be at a higher cost so because creditor will feel less likely to receive payments from you.
Tax bills: foreclosure may include some form of debt forgiveness for instance where you may find that the current market value of the house is less than the amount you owe and you agree with your lender to redeem your house at that price. According to the IRS, that is an income to you as a borrower which is a taxable income.
Difficult in buying a new home: victims of a foreclosure find it hard to raise the down payments or the credit score required in order to obtain another mortgage, most lenders and mortgage insurers such as Fannie Mae does not lead to persons with a foreclosure in the last 5years.
Lowell ordinances
These ordinances are meant to protect and preserve public safety, security and quiet enjoyment of the occupants, abutters and neighborhoods by requiring: all residents, commercial and industrial property owners, lenders, trustees and the service companies to properly maintain vacant and/or foreclosing properties and regulating the maintenance of vacant and the foreclosing residential, commercial, and industrial properties so as to prevent impaired and unsecured properties. All this efforts are so as to avoid fallout in values of the properties.
Sources
https://support.propertyradar.com/hc/en/-us/articles/2014172910-types-of-foreclosure
https://homeguides.sfgate.com/disadvantages-foreclosures.1420.html