What is foreclosure and when does foreclosure begin?

Foreclosure is the legal process lenders must follow to take possession of the home. It is a process that begins when mortgage payments have not been made according to the terms of the Promissory Note and Deed of Trust. Most lenders begin the foreclosure process when payments are at least three months late; however, the process can begin sooner.

 

If my mortgage is not three months late, should I still reach out for help?

Yes. If you have not made regular and full payments according to the terms of your loan, seek assistance early to obtain help in avoiding foreclosure. Do not ignore the problem or delay seeking assistance. Waiting will only worsen the situation.
 
A company has contacted me and said that they can help me avoid foreclosure if I pay them. Should I pay them? 

 

No. It is illegal in North Carolina for any company to charge you upfront fees for foreclosure prevention services. Scams can be reported to the Attorney General or by calling 1-877-5-NO-SCAM.

 

If I don’t have an attorney, who can help me understand my legal rights? 

In the event you receive foreclosure papers, you may wish to contact an attorney. Free legal services may be available to you. The following organizations may be able to help:

Legal Aid of North Carolina - 866.219.5262
The North Carolina Justice Center - 919.856.2570

 

I requested a modification under the HAMP guidelines. I need help with my forms and have questions about the documentation. Who can help?

HUD-approved housing counselors may also help you request a modification or gather documentation for this program.

 

What can a foreclosure counselor do to help me?

Your counselor will schedule an intake session with you to discuss your hardship, current financial situation, discuss foreclosure prevention options and assist you in contacting the mortgage company.

 

 

Foreclosure timeline in North Carolina

 

Please Note: The dates and process are ESTIMATED and vary according to your mortgage company. Stay in contact with your lender and get assistance from a housing counselor as early as possible.
 
Late Payments: Your lender may contact you by letter or phone at any time after a payment has been missed. A HUD Approved Housing Counselor can help.
 
Standard Default Letters: Your lender may start to send letters 15 days from the missed payment date and continue every 30 days that the loan continues to be in default.

 

Demand Letter or Pre-Foreclosure Notice: You will receive a letter from your lender stating the amount you are delinquent, and that you have to bring your mortgage current by a specific date. This letter is called a "Demand Letter, Acceleration Letter, Notice of Default or Pre-Foreclosure Notice. ” If you do not pay the specified amount or make arrangements by the given date, the lender may begin foreclosure proceedings. However, you still have time to work something out with your lender. A HUD-Approved Housing Counselor can still help.
 
Notice of Hearing – The Notice of Hearing marks the beginning of foreclosure proceedings at the courthouse in the county where the property is located. The attorney files paperwork with the court and schedules a hearing and sale date. The Notice of Hearing must be be provided to the record owner of the property at least 10 days before the hearing date. You have until the date of sale to make arrangements with your lender, or pay the total amount owed, including attorney fees. If you attend the Foreclosure Hearing, you may be able to receive a continuance of 60 days to allow more time for a workout – PLEASE ATTEND THE HEARING.

 

Public Trustee's Sale – This is the actual day of foreclosure. The sale must be conducted at the courthouse in the county where the property is located. Notice of the sale must also be served upon the record owner of the property at least 20 days prior to the date of the sale. Sometimes this Notice is served at the initial Notice of Hearing, but may also be served separately. The Notice is also published in a newspaper of general circulation in the county where the property is located once a week for two (2) successive weeks, with the last ad being published not less than ten (10) days before the sale; and posted on the courthouse door for twenty (20) days prior to the foreclosure sale. The property will be sold to the highest bidder. This is not the move-out date.

 

Redemption / Upset Bid Period – After the sale date, you may enter into a redemption period, commonly known in North Carolina as the “Upset Bid Period.” You will be notified of your time frame (usually a minimum of 10 days in North Carolina), on the same notice that your state uses for your Public Trustee's Sale. You may still be able to file bankruptcy during this period to save the house.