What are Notices of Default?

A Notice of Default is a legal document that a lender files, indicating that you are behind on your mortgage payments, and that they are begin proceedings to take back the property if you do not pay up on what you owe. For example, with foreclosures in any state, such as California foreclosures, a notice of default must be sent. In some states, a Notice of Default is simply a matter of public record, whereas in other states, it may actually be posted on your home, indicating that you are in default on your loan. 

Depending on the state, a Notice of Default may be issued when you are 90 days or more overdue on your mortgage payments.  This timeframe varies by state, but if you have received a Notice of Default, you must take action quickly to avoid foreclosure on your home.   

If you have received a Notice of Default, consider: 

• Contacting your lender directly and immediately, if you have been avoiding all past due notifications up to this point.  This problem will not go away on its own.  Talk to your lender about renegotiating the terms of your loan, known as loan modification. 

• Contacting other lenders to refinance your mortgage before your lose your home.

• Putting your home up for sale, or for short sale to avoid the credit debacle of foreclosure.

You should also consider speaking with an experienced lawyer as soon as you receive a notice of default. Your attorney can help you to determine the best course of action for saving your home, your credit or both.