Falling behind on your mortgage payments can lead to foreclosure, which is sometimes unavoidable. Banks can work through government programs to get some mortgages back on track, but if that's not a possibility, you will have to move out after the foreclosure is complete. The exact date you must move out is different in every case; some people have days to exit their former homes while others have months.
Review your state's foreclosure laws or consult with a real estate attorney about your options. Each state has different laws on how foreclosures must be handled. You must always be notified that you're in arrears and given time to create a payment plan so you can avoid foreclosure. This is usually about a month. After the deadline passes, the bank sends you a notice of foreclosure telling you when the bank plans to auction your home or resume possession of it. You can stay in your house while receiving these notifications.
Call your mortgage company to ask about move-out incentives. When people leave foreclosures, many tend to sell off items such as appliances and light fixtures, which can reduce the house's worth. Some also become destructive, damaging the home before moving out. Some lenders offer financial incentives ranging from a few hundred to a few thousand dollars if you leave your foreclosed home clean and intact. This also saves them the trouble and expense of keeping your yard mowed while finalizing the foreclosure. The incentive money can help you pay for your move and gives you a timeline so you know when you must move out.
Look for new places to live while waiting on your house to be sold. Even after the foreclosure is final, you don't have to vacate the property until you receive an eviction notice from the bank or the new owner. This can benefit you by allowing you to live in the house without making monthly payments, sometimes for months. It can also benefit your neighbors; when you keep your yard neat so your home isn't an eyesore, your neighbors' property values stay up. You might not be eligible for move-out incentives if you stay after the foreclosure is final, but you can save money you would be spending on mortgage or rent. The eviction process usually takes a couple of months, which gives you time to pack and move before the eviction deadline.
Pay property taxes and homeowner's association fees while you're waiting on the foreclosure process to finish. Banks sometimes wait months to finalize foreclosures even if they've sent you a 30-day notice. If the bank stalls, you're still responsible for taxes and association dues. Not paying these can lead to liens on the home, which can appear on your credit report and reduce the chances of you finding a home to rent.
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- Wall Street Journal: Buyers' Revenge -- Trash the House After Foreclosure
- Bankrate.co,: What Delays a Mortgage Foreclosure
- Nolo: What to Expect Once You Decide to Let Your Foreclosure Proceed
- MSN: Facing Foreclosure? Don't Pack Just Yet
- Nolo: How Staying in Your House During Foreclosure Helps Your Community
- David Sacks/Lifesize/Getty Images