Who is responsible for the mortgage payments during the foreclosure transfer process?

Even if you take no action to contest a foreclosure action, it can still take two to four months simply to complete the court processes, foreclosure sale, and the formalities that follow.  During this period while the foreclosure is pending, the homeowner/mortgagor remains legally liable for the mortgage payments due on the home loan.  Even after the foreclosure sale, many states mandate a “redemption” period – a length of time within which a homeowner can redeem the property, usually by obtaining a new loan to pay the old one off.  If redemption is a real possibility, a homeowner may very well want to continue to make mortgage payments, as this would both reduce the amount that must be refinanced and also show a potential new bank that the homeowner is a good risk. 

If the homeowner plans to attempt to obtain a loan to purchase a different property, making payments on this one might make sense for the same reason.  However, if a homeowner has no intentions of attempting to obtain bank financing soon, then continuing to make payments would serve only to reduce an ultimate “deficiency” amount owed after sale proceeds are credited against the balance owed on the mortgage.

Talk to a Foreclosure Defense Attorney if you are facing a foreclosure and need legal options to keep your home, or protect yourself from a deficiency judgement.