A foreclosure notice may be any document that informs a mortgage holder of current or upcoming status regarding a foreclosure. Foreclosure notices serve both to inform the mortgage holder that he or she is in danger of losing a home, but also provide the owner or lender with a record of compliance with all applicable regional notification laws. A foreclosure notice can warn borrowers of impeding foreclosure proceedings, announce the beginning of the foreclosure process, or declare the date and time of an auction for the property.
In most cases, a person will begin to receive notices of an upcoming foreclosure if he or she is late on mortgage payments. Notices are typically not used if a payment is a few days or weeks late, but may begin arriving once a payment is more than 30 days late. Depending on the lender and the jurisdiction, an initial notice of potential foreclosure will generally arrive between one month and six months after payments cease.
Receiving an initial foreclosure notice does not mean that a person is going to lose his or her property. This type of notice serves as a warning of foreclosure, and initiates what is known as the “pre-foreclosure” period. Typically, an initial notice will give the borrower a set time period in which to bring his debt current. If a borrower is able to make the late payments within this time period, the lender will not have a reason to begin an actual foreclosure. In some cases, a borrower can also bargain with the lender to have late payments factored back into the principal loan amount, or to set up a schedule to repay missed payments during this period.
If the borrower continues to miss payments, additional notices of impending foreclosure may be sent every few weeks. After a certain period of time, the lender will serve a more official foreclosure notice, known as a notice of default. This notification begins the foreclosure process, but still does not necessarily mean a borrower is out of luck. Generally, the lender must wait about 90 days more before it can legally seize and sell the property.
In some regions with judicial foreclosure laws, lenders must initiate court proceedings in order to foreclose on a property. This means that hearings will be held to determine the legality of the process; the dates and times of which are usually included in the official foreclosure notice. Borrowers can attend these hearings, and may sometimes be able to delay the execution of the foreclosure if they can show a desire or ability to work out the terms with the lender. In non-judicial foreclosure areas, no court hearings are held unless the borrower files a lawsuit for unlawful foreclosure. Most areas also require foreclosure notices to be published publicly, either by posting the notice on the property or placing a notice in a local newspaper.