Many factors, such as loss of a job, a significant illness, a divorce, a business failure, or accumulation of too much debt can result in a Nevada homeowner falling behind on their mortgage payments. After several missed payments, the mortgage holder has the right to initiate foreclosure on the property securing the mortgage. Foreclosure is a long and complicated process to go through for both the lender and the homeowner. During that process, the homeowner still has options that will help them keep their property.
How does the foreclosure process take place?
- Missed Payment and Late Fee
Once you miss a mortgage payment, you have a grace period of ten or fifteen days, after which the loan servicer can charge a late fee. This fee is generally around 5% of the past due payments of principal and interest based on the note’s terms.
- Reminders of payments due
After missing several payments, you may receive letters or calls reminding you of your overdue payments. Letters must include important information about the loan, the account, amount to pay to avoid foreclosure, and alternate options to prevent foreclosure.
At this point, it is an excellent time to look for counseling and talk with your bank or lender about a repayment plan, forbearance, loan modification, or reinstating the loan. An attorney can represent you, negotiate, and find the option that best suits your needs.
- Notice of Foreclosure
The bank or lender must wait until you have become 120 days delinquent on your mortgage payments before the first official notice or filing for any non-judicial or judicial foreclosure. Most times, residential foreclosures in Nevada are non-judicial. For a foreclosure to be non-judicial, it must have a power of sale clause in the mortgage or deed of trust, and the legal procedure will begin with Notice of Breach or Default (also known as a NOD-See NRS 107.080 (4)) and Election to Sell. The lender must mail the Notice of Default to the homeowner by registered or certified mail.
- Foreclosure Mediation
For owner-occupied homes, the notice must inform the homeowner of their right to participate in the foreclosure mediation program. If the homeowner elects to participate in mediation, the foreclosure must be put on hold until the mediation is complete, and a certificate of compliance is issued. The mediation must take place within 135 days of the homeowner electing to mediate.
- Notice of Trustee Sale.
Before the foreclosure sale, you will receive notices such as Notice of Trustee Sale. Before posting the Notice of Trustee Sale, the Notice of Default has to have been posted for three months before the Notice of Trustee Sale is posted. The Notice of Trustee Sale must be posted on the home for 20 days and must be published in a prominent newspaper publication within the county that the home is located in for three consecutive weeks (at least one day each week).
- Foreclosure Sale
During the foreclosure sale, the property will be sold to the highest third-party bidder or repossessed by the foreclosing lender. This foreclosure sale can be delayed for a period with the help of a lawyer, giving you more time to stay in your home, get back on your feet, and resolve the situation.
- Deficiency Judgment and Non-Recourse Loan
You should know that your home can sell for less than what you owe to the bank or lender, and you will be liable for that difference. This balance is called a Deficiency Judgment.
Mortgages originated AFTER October 1, 2009, may qualify as a nonrecourse loan, meaning that the lender CANNOT go after you for any deficiency. There are restrictions for the homeowner’s mortgage to be eligible as a non-recourse loan. An experienced foreclosure attorney can help you determine if you qualify.
- No Redemption Period in Nevada
In some states, you can still pay and recover your home after the foreclosure sale, but NOT in Nevada.
- Vacate the property
If you do not vacate the property after the foreclosure sale, the new owner can offer you a cash offer to hand over the keys or give you a three-day notice to leave before filing an eviction lawsuit.
It is essential to know that you have options, and depending on your case, one of these can be the perfect solution to a foreclosure situation. You need an experienced debt and foreclosure attorney to advise you and act in your best interests. Contact Debt Rescue Law for a FREE consultation at (833) 707-1234.
