Owing to global economic downturn, millions of homeowners in the US are facing the risk of losing their homes due to foreclosure. To a certain extent, life after foreclosures is primarily dependant on the redemption period provided to the individual as per the statutes of the state government the person resides in.
Whenever any foreclosed property is auctioned, the highest bidder on the property would become the new homeowner. Once the auction is complete and the property sale is confirmed, the new homeowner can proceed with the eviction process. However, the time taken for confirmation of property sale can vary from a couple of days up to few weeks and is entirely dependant on the state foreclosure laws.
Once the new homeowner submits the property sale and transfer of ownership papers in the court after foreclosure, it thus initiates the process of eviction. In this, the county court grants the possession of property to the new owner. Eviction also involves the court directing the county sheriff issue an eviction notice to the former homeowners ordering them to vacate the property with certain period. Eviction also involves removal of all the entire property present inside the home within that time, also termed as redemption period.
In simple terms, redemption period is the time provided to the borrower to buy back the property from the highest bidder after the house has been auctioned after foreclosure. In US, the redemption period varies from state to state. For example, when an individual faces foreclosure in Alabama, Alaska, Arkansas, Kansas, Kentucky, Idaho, Missouri, Wisconsin, or California, the redemption period is 1 year. On the contrary, redemption period in 6 months in states such as north Dakota, Vermont, and Minnesota. In Mississippi, Michigan, Wyoming, and New Mexico, borrowers can take back their property within 30 days. Redemption period is 3 months in Illinois, 20 days in Iowa, and 10 days in New Jersey. Redemption period also indicates the number of days an occupant can stay in the foreclosed property before the eviction notice is served and property is handed over to the new owner. In states with limited redemption period, victims have to vacate the houses within few days and scramble around in order to find a shelter. If the previous homeowner does not leave the property even after the expiry of eviction notice period, then the court intervenes and the occupant is vacated forcibly. If any such thing happens, then the credit record of the victim would indicate foreclosure and forceful eviction, which would make it impossible for him even to rent a property after foreclosure.
Once the eviction notice is served, there is very little that the victim can do from preventing the new homeowner to take possession of the property. Although mortgage loans are the only way possible to buy back the property before the redemption date expires, foreclosure victims are no longer eligible for these loans.
As a homeowner, one should realize the fact that life after foreclosure is an extremely painful and heartbreaking experience. Therefore, one should take appropriate care and plan accordingly to avoid situations that arise after foreclosure. For this purpose, it is always better to check various options such as home loan refinance, or contacting the mortgage lender mortgage restructuring rather than losing homes due to foreclosure.
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