Responding to a Foreclosure Lawsuit Called by a Lender

Your lender can institute a foreclosure action against you when you default on your mortgage. Generally, you must be at least 90 days behind on your mortgage before any legal action will be taken by your lender. Sometimes lenders wait longer periods because they want to work out a solution with their borrowers to avoid foreclosure. Foreclosure costs everyone time and money.

Responding to Mortgage Bank’s Foreclosure Lawsuit

You have a statutory right to respond to your bank’s foreclosure lawsuit. Each state has different foreclosure statutes so you need to check your state laws. You should hire a foreclosure defense attorney to respond on your behalf. A copy of the response must be served upon the lender and filed with the court. If you do not respond, the court will issue a default judgment and order your home to be sold at a public foreclosure auction sale.

Process of the Lawsuit

1. Once the lender institutes the lawsuit and serves you with a copy of the lis pendens, summons and complaint, you can either respond or not respond. NO response automatically means a default judgment is entered and the property goes to foreclosure auction.
2. The notice of sale is published in a newspaper of general circulation in the county where the property is located. The notice is also posted at the property and at the courthouse where the sale is going to take place. The sheriff or court clerk will conduct the foreclosure sale on the courthouse steps.
3. The highest bidder is awarded the property. If the property does not sell at the auction, then the bank buys it back and it becomes real estate owned (REO) property. The borrower may have a right to redeem the property after the sale if the state statute allows for statutory redemption.

Also the lender may obtain a deficiency judgment against the borrower if the statute allows for a deficiency judgment.

Help from a Foreclosure or Real Estate Lawyer

If you are served with a foreclosure lawsuit, you should immediately hire an attorney to represent you. The attorney can advise you of your rights and remedies and other options to save your home from foreclosure.