The Foreclosure Process and Timeline The foreclosure process is lengthy and the timeframes for when the Mortgage Lender begins the process varies from state to state. Foreclosure: A legal proceeding in which a mortgage bank attempts to obtain the right to sell the property to recover the amount owed to them when the Owner of the property fails to make payments.

The Foreclosure Process The foreclosure process is lengthy and the timeframes for when the Mortgage Lender begins the process varies from state to state. PHASE I: DEFAULT Foreclosure: A legal proceeding in which a mortgage bank attempts to obtain the right to sell the property to recover the amount owed to them when the Owner of the property fails to make payments. 60 or more days in arrears

The Foreclosure Process It is during this phase that the homeowner might explore selling the property in a short sale for the following reasons: Damage to credit history is lessened Ends the stress sooner More dignified and less embarrassing than foreclosure PHASE II: PRE-FORECLOSURE PHASE I: DEFAULT 60 or more days in arrears Lender sends Formal Notification to Homeowner Short Sale: A short sale occurs when the seller’s lender accepts a discounted payoff to release an existing mortgage. They are settling for less than the amount due. This is sometimes referred to as a “pre-foreclosure sale.”

The Foreclosure Process PHASE I: DEFAULT PHASE II: PRE-FORECLOSURE PHASE III: FORECLOSURE Loss Mitigation is not successful Lender sends Formal Notification to Homeowner 60 or more days in arrears When a short sale is not successful, and the homeowner is unable to work out any other options with the Lender, the property is then foreclosed on by the Lender and owned by the Lender. At this point, the Lender will attempt to sell the property via a Sheriff sale/auction.

Can a Commission be Paid? Homeowner is in default Property is Foreclosed On Loss Mitigation is not successful Risk to the commission increases as the process moves toward the actual Foreclosure. Pre-Foreclosure Phase Begins 60 or more days in arrears Lender sends Formal Notification to Homeowner Low Risk High Risk