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If you miss out on mortgage payments, the lender that loaned you money may offer your home to gather the cash you owe. This is foreclosure.

When you got your loan, you participated in 2 contracts with the bank.

- One agreement is the "note." The note says you assure to pay back the cash you borrowed.
- The other agreement is the mortgage. The mortgage states you understand that the bank can take your house to pay the debt if you do not repay the cash you owe.
The bank must follow foreclosure laws before they can take your house. They should inform you about the auction and reveal it in the paper before they foreclose. There are laws that provide you time to find a method to capture up on your missed out on payments or find another way to avoid foreclosure. If the bank does not follow the guidelines, they can not foreclose. It is necessary to understand:

- What the bank needs to do,
- When it has to do these things, and
- How to understand if the bank is following the rules.
Mortgage Holder

Mortgage Holder

The mortgage holder deserves to foreclose on your home if you do not make your payments. The mortgage holder can be a bank, a company, a trust, or a person that owns the mortgage.

Noteholder

The "noteholder" is the business that owns the right to collect your payments.

Servicer

The business that sends you notifications and expenses is usually the "Servicer" for the mortgage holder. The mortgage holder works with a servicer to gather payments, handle escrow payments, process loan adjustments, and communicate with you about the loan.

Sometimes the mortgage holder, noteholder and servicer are all the same company. Sometimes they are three various business. In Massachusetts, a company that wants to foreclose must be both the mortgage holder, and either the noteholder, or an authorized agent of the noteholder.

When you signed your mortgage, you accepted make all your payments on time. If you miss payments you remain in "default," or you "default on your mortgage." Paragraph 22 of the majority of mortgages (or paragraph 26 for mortgages signed after 2021) is the place that says you provide the bank the right to foreclose if you default on your mortgage. Look at paragraph 22 of your mortgage to see if it states you concur the bank can foreclose if you default or miss payments.

In Massachusetts, the bank does not need to go to court to foreclose on your home. The bank, or mortgage holder, can hold an auction to foreclose on your home. The bank reveals that it is offering your home on a particular date. The bank can sell your home to the individual who offers the most cash.

When banks foreclose on a residential or commercial property without going to court, this is called the exercise of the "power of sale" licensed by the mortgage. But to utilize the power of sale, banks must follow all the regards to the mortgage and follow state foreclosure laws.

If you fall back on your mortgage payments, the bank can just foreclose if they give you the right notices, tape-record the notices and release the auction in the newspaper. They must:

Give you a Right to Cure Notice that states you have a number of days to capture up on your payments. If you capture up with the overdue mortgage payments, they will not foreclose.
Give you a Right to Modify Notice. Sometimes the bank must alert you that you have a right to ask the bank to change the way you pay back your loan. Changing the way you pay back your loan is an adjustment. If you can request a modification and your earnings is low enough, the bank might need to give you a modification.
Give you a Velocity Notice that informs you the total of your loan is due and if you do not pay it, the bank will foreclose.
Give you a Relief Act Complaint. Banks should provide this notification to everyone they are starting to foreclose on. If you are in active military task, you can stop a foreclosure by answering this grievance.
Record 2 affidavits at the Registry of Deeds. One affidavit states the bank owns, or manages the note and the mortgage. The other affidavit states the bank followed the law under G.L. 244, s. 35B and gave you the Right to Modify Notice.
Publish the auction in the newspaper. For 3 weeks in a row, the bank needs to publish the date and time of the auction in the paper.
Give you a Foreclosure notification that tells you the date of the foreclosure auction.
Once the bank has actually followed all the actions after you miss your payments, they can hold an auction and offer your home to the buyer who provides the most money.

The bank will auction your home on the date and time in the notices in the paper and the letter they sent to you. If the auction was delayed by proclamation the auction will occur on the date it was revealed.

If there is a foreclosure auction arranged within the next 7 days, the Massachusetts Division of Banks might be able to help you get a 60 day post ponement.

The auctioneer and an agent of the bank will concern your residential or commercial property. The auction does not need to occur on your residential or commercial property. It can be near your residential or commercial property.

For both of these foreclosures, the individual who runs the auction should be a certified auctioneer. The highest bidder wins the auction. The bank is permitted to bid at the auction. The bank typically wins the residential or commercial property.

The buyer typically has thirty days to pay the complete quantity that they bid, and sign the paperwork. Once all the documents is signed, the bank signs the deed and offers it to the new owner.

If the highest bidder does not pay the total within the 1 month, they lose their deposit. The 2nd highest bidder can take the residential or commercial property.

On the day of the auction, you may see a person who is representing the bank action onto your residential or commercial property. They do this to make sure that if something goes wrong with the foreclosure by auction they can still take your home a various method. This type of foreclosure is "foreclosure by entry." The bank representative does not need to enter your house. They can just step onto your land, anywhere.

Within 30 days after the sale, the bank that offered your residential or commercial property should tape a copy of:

- the notice of sale, and
- an affidavit that the foreclosure sale was conducted correctly.
The Registry of Deeds makes this details offered online.

After the foreclosure, the new owner needs to send you a notification that informs you who won the auction. The winner of the auction is the new owner of your residential or commercial property.

You may not get the notice immediately. It might take a couple of weeks.

If a bank is the brand-new owner, they will have a residential or commercial property supervisor. You will get a notification that tells you the name of the residential or commercial property supervisor. Contact the residential or commercial property manager if there are issues with your house.

You can also discover who the brand-new owner of your residential or commercial property is by taking a look at the deed. See the Registry of Deeds for the town where the residential or commercial property lies.

If the sale of your house did not generate adequate to cover the overall quantity you owe the bank, you still owe the bank money. The cash you owe is a "deficiency."

The bank can sue you for the shortage. But they need to have offered you the proper notification before the auction. The notification should have stated they planned to "look for a shortage" after the sale.

If you can not manage your mortgage you might need to quit your home. But you may be able to have more control over how you offer it up and avoid foreclosure.

Or, you might have the ability to keep your home:

- Contact the bank and ask if you can exercise a strategy to keep your home.
- Connect with A HUD-approved housing therapy agency to learn what you can do.
- Contact the Massachusetts Attorney General's Consumer Advocacy and Response Division to read more about your rights.
- Try to get legal assistance.
Bankruptcy might be alternative for stopping a foreclosure sale. A Chapter 7 personal bankruptcy may only delay foreclosure. However, if you can make ongoing payments once again, a Chapter 13 bankruptcy can enable you up to 5 years to repay an arrearage. Talk to a legal representative.

Foreclosures are made complex. Try to get legal help.

You may be able to get complimentary legal aid from your local legal aid program.

If you do not receive legal help, try a legal representative referral service. If your earnings is low enough, you may qualify for their decreased charge referral.
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