Foreclosures

There is nothing like losing your home. After all home ownership is a big American dream. If you receive notice that your home is in foreclosure contact an attorney asap. This past month we have had phone after phone call from people with misinformation about foreclosures. Please don't take legal advice from non-attorneys!

First, in Missouri, foreclosures are easy to do. Moreover, they are very quick. For most deeds of trust (in other states these are often called mortgages), the creditor has to mail the notices certified return receipt requested (is most often required) and publish in the legal newspaper. I have news for my fellow Missouri residences: the creditor does not have to show that the borrower received the letter. They merely have to mail it to the correct address 20 days before the foreclosure. Yes, 20 days! Additionally, real people don't even know about most of the legal newspapers. So, they are unlikely to read it. On the other hand, many of my fellow bankuptcy attorneys write the borrowers to see if they are seeking legal services.

Secondly, in Missouri, foreclosures are hard to undo. I am not saying that we have not had a few foreclosures set aside ... we have. It is always exciting to win this kind of case as it is a long shot for most cases. I have also lost on setting aside a foreclosure ... in part because even though my client's address was wrong it was close enough for the mailman to testify that he delivered mail to my client's address with the wrong street name often. Additionally, the mailman testified that my client did not take their mail out of the mailbox most of the time. If you recieve a certified letter -- go get it and open it. No one can tell you want is in the letter without someone opening the letter and reading it.

There are things that can be done to stop a Missouri foreclosure before it happens or to help someone redeem the house after the sale. Redeem means to get the house back. However, you can't just wait. One of the ways to stop a foreclosure is to file a bankruptcy. When you file bankruptcy for the first time the automatic stay stops foreclosures. (Different rules apply if it is not your first case, seek legal advice to see these different rules and how they apply in your case.) This stops the foreclosure. The Chapter 13 plan deals with the missing house payments and my clients start down the road to their fresh start.

First, let me say that Kansas has better laws for debtors than Missouri does. Foreclosures take longer as it has to go to Court. Judical foreclosure is the most common manner of foreclosure. Second, the law on redemption is much better. The time to redeem is based on many factors and you need to see an attorney for advice on your case. I won't waste your time spelling all of the rules out.

If you receive notice of a foreclosure, you need to sit down and have a talk with yourself and your family. I suggest that you go though the following questions:
1. Do you want to keep the real estate?
2. Do you owe the money? Have you made payments that are not accounted for by the lender?
3. Do you have an equity in the property? (Do you owe less on it that you could sell it for here and now?)
4. Can you make the on-going monthly payments?
5. Can you get current before the sale?

Before the notice of foreclosure, when you are falling behind in the payments is the time to call the lender and try to work something out. I know many people who have been successful in working out with the lender a plan to make up the missing payments. However, if you fall behind in your work-out deal with the lender ... get to an attorney to see your options.

Bankruptcy is a powerful tool. It can help people get back on their feet after getting behind on their bills. However, it takes a lot of work and time. It can stop a foreclosure but it still takes money to make the monthly house payments. With these new adjustable rate mortgages, many of my clients are forced to let the house go back to the lender.