Taking on a mortgage is a big commitment in the life of a Tennessee resident. Unlike paying rent, a person who secures a mortgage for the purchase of a home is often committed into a long-term, sometimes multiple decades-long contract to pay off their loan. When circumstances arise and the person cannot make their mortgage payments they may face challenges from their mortgage holder and threats of foreclosure on their loan.
Foreclosure is the process of a bank or other lender reclaiming a home from a borrower who has defaulted on their payments. When a person secures a loan to buy a house their lender effectively purchases the property and then allows the individual to repay them over time and with interest until the full amount of the home loan is satisfied. The failure of the individual to make full and complete payments can force a lender to take back the home and resell it to recoup their losses.
Individuals who are afraid that their lenders may seek to foreclose may attempt to stop the process through a short sale. A short sale happens when a house is under water, or in other words when a house is valued at less than the amount of the loan that has been secured for it. If a lender agrees, a person may be allowed to sell their home for a reduced rate so that their lender can recoup some of their losses, but generally during a short sale the purchase price of the home is not going to provide a lender with the full amount of the loan that they are due.
Getting advice on foreclosures and short sales is an important step in protecting one’s home. Addressing these serious legal issues should be a priority for all who are facing them and attorneys throughout Tennessee are prepared to help their real estate clients with their pending legal troubles.