The foreclosure process varies from state to state. In some states, such as Florida, a judge must give a lender permission before it can repossess your home.
Being served with a foreclosure lawsuit means that your lender has filed a "complaint" alleging the reasons why it feels it should receive your house as payment of the debt you owe. This complaint includes a "summons," allowing the court power over you, and a "lis pendens," a document filed in public records advising that the property is the subject of a lawsuit.
Typically, you will have 20 days to respond to the lawsuit. Responding within this time period is important; if you do not do so, you will be in "default," thus allowing the lender to proceed with the foreclosure.
Prior to the 20 days, your attorney should respond to the suit with a "motion to dismiss" or an "answer." A motion to dismiss means that your attorney feels that the bank has no chance to win based on the complaint. An answer admits or denies each of the reason alleged in the complaint, and provides "affirmative defenses," or reasons why the lender should not repossess your home.
Within a few months, the attorneys will begin the "discovery" process where they interview the parties involved and collect supporting documentation. During this time, you, your attorney, and the lender, may attend "mediation" and attempt to settle the lawsuit with the help of an unbiased third party. You will not be forced to settle during mediation.
The discovery process will take approximately six months. After discovery, either party may file a "motion for summary judgment" if they feel that their case is so strong that they cannot lose. Most foreclosures end at this point, as the judge often finds the lender's case the most compelling. If the judge feels that there are still some unanswered questions, you will go to trial and the judge will determine the case.
If you win, the lender may not sell your home. If you lose, which is the most likely scenario, the judge sets a date for the sale of your home and the proceeds will go towards paying off your debt to the lender.
If the sale price is greater than the amount you owe, you should receive the difference. Your attorney should process this refund for you.
With the help of an attorney, the entire foreclosure process averages about two years. This will give you time to work toward a loan modification, short sale, or deed in lieu of foreclosure. Your final option is bankruptcy.
Source: Sun Sentinel (Ft. Lauderdale, Fl), Gary M. Singer.
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