Many U.S. states require judicial foreclosures, where a lender must go through the court system to initiate foreclosure proceedings if a borrower violates the terms of their mortgage contract. In most states, these judicial foreclosures require the court to enter a judgment just like in any other type of case. In other states, such as Maryland, lenders do have to go to court, but the proceedings are streamlined.
In a non-judicial foreclosure, a lender can bypass the courts’ supervision and oversight, which typically speeds up the foreclosure process exponentially. Lenders are then authorized to sell the foreclosed property in order to collect the remaining balance of the loan.
Foreclosure laws vary by state, but share similar aspects as well. These laws are in place to protect homeowners and ensure they are properly informed, thus allowing them to honor the loan and avoid foreclosure whenever possible. All lenders must communicate to their borrowers each step of the foreclosure process to ensure the borrowers understand the situation and what further options they may have.
The Foreclosure Process
Although each state has their own foreclosure process, they generally follow the same events:
- After agreeing to a mortgage contract with a borrower, the lender would send out a notice of delinquency if the borrower had missed one or more payments.
- The borrower and lender will agree to a plan of action for the borrower to catch up on payments.
- Some states require the borrower to be more than 120 days late on a payment in order to brought to foreclosure.
- If more payments are missed, the lender may initiate foreclosure proceedings.
- In a non-judicial foreclosure, the lender can sell the property, possibly through auction, in order to collect the balance of the loan. In a judicial foreclosure, the court system oversees the proceedings and can give the borrower a deadline to pay off the loan.
- A public auction will then be held and the property goes to the highest bidder. When this happens, the borrower cannot regain the property unless it is bought back.
Maryland Foreclosure Laws
The state of Maryland utilizes both a judicial and non-judicial foreclosure process in order to streamline an already-lengthy process and ensure it is a fair and proper. However, in a non-judicial foreclosure, the court is not involved as heavily as it would be in a typical judicial foreclosure.
The borrower must be notified at least 45 days before the foreclosure process begins. Notice must include the name of the loan servicer (if not the original lender), the reason for default, and a “loss of mitigation” application, which is another way to settle the loan without foreclosing. Ignoring these notices could limit a borrower’s chances of avoiding foreclosure.
Several other proceedings must occur before the foreclosure is finalized. The lender must also provide proper documentation to the court, including amount owed on the loan, court fees, order to docket, and all other fees in the foreclosure process. They would also have to provide a loss mitigation affidavit, which informs the court of what options the borrower was given to avoid foreclosure. It is imperative for a homeowner to request mediation as early as possible to help their chances of avoiding foreclosure and accruing more court and attorney fees.
Towson Foreclosure Lawyers at Huesman, Jones & Miles, LLC Protect Clients Throughout the Foreclosure Process
If you have questions about the foreclosure process in Maryland, contact the Towson foreclosure lawyers at Huesman, Jones & Miles, LLC today. Our experienced and knowledgeable lawyers can help you navigate the foreclosure process and protect your rights. Call us at 443-589-0150 or contact us online for a confidential consultation. We have offices in Towson and Hunt Valley, Maryland, allowing us to represent clients in Baltimore, Bel Air, Columbia, Westminster, Essex, Monkton, Sparks, Parkton, Pikesville, and throughout Baltimore County, Carroll County, Harford County, and Howard County, Maryland.