Common Foreclosure Terminology

Accelerate
An option given to lenders through an "acceleration" clause in the mortgage or deed of trust requiring the borrower to pay the entire balance of the loan all at once if their loan is in default.

Affidavit
A sworn statement in writing usually given while under oath or in the presence of a notary.

Appraisal
The process in which a licensed or authorized person gives an estimate of property value.

Appreciation
The difference between the increased value of the property and the original value.

Assignment
The transfer of property to be held in trust or to be used for the benefit of the creditors (lenders).

Bid
The offered amount for a property for sale at auction.
Certificate of Sale
A document given to the winning bidder at a foreclosure sale stating their rights to the property once the borrowers redemption period has expired.

Clear Title
A title that is not burdened with defects.

Credit Bid
A bid on behalf of the lender at a foreclosure sale. The bid amount must be less than or equal to the balance of the loan in default.

Decree
A judicial decision.

Deed
A signed document that transfers ownership of property from one party to another.
Deed-in-lieu of Foreclosure
An instance where borrowers voluntarily convey their rights in a property to the lender.

Deed of Trust
A three party security instrument conveying the legal title to real property as security for the repayment of a loan. The three parties included in a deed of trust are the borrower, lender and trustee.

Default
A mortgage or deed of trust is said to be in default when the borrower fails to make the payments as agreed to in the original promissory note.

Deficiency Judgment
A personal judgment against the borrower for the remaining balance on the loan after a foreclosure sale.

Equitable Title
The present right to possession with the right to acquire legal title once a preceding condition has been met.

Fair Market Value
The price a property would sell for on the open market.

Foreclosure
The forced sale of property pledged as security for a debt that is in default.

Free & Clear
Ownership of property free of all indebtedness.

Judicial Foreclosure
A foreclosure that is processed by a court action.
Lien
A charge upon real or personal property for the satisfaction of a debt.

Legal Description
A formal description of real property sufficient to locate it by reference to government surveys or approved recorded maps.

Lender
A person who lends money for temporary use on condition of repayment with interest (i.e., the bank, mortgage company, etc.).

Lis Pendens
A recorded notice of pending lawsuit.

Mortgage
A written pledge of property that is used as security for the repayment of a loan.
Non-judicial Foreclosure
The non-judicial process of foreclosure is used when a power of sale clause exists in a mortgage or deed of trust. A "power of sale" clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of their default.

Notary
A public officer licensed by the state to attest to and certify the validity of signatures of others. A notary is often referred to as a notary public.

Notice of Sale
A notice giving specific information about the loan in default and the proceedings about to take place. This notice must be recorded with the county where property is located and advertised as stated in the security document or as dictated by state law.

Personal Property
Property other than real property consisting of things temporary or movable.

Posting
To publish, announce or advertise by physically attaching a notice to an object.

Postponement
Postponement means to put off to a later time. In the case of a foreclosure sale, this is generally done by announcement at the original sale or by posting notices establishing the new date and time the foreclosure sale will take place.

Right of Redemption
A borrower's right to reacquire property lost due to a foreclosure.

Request for Notice
A recorded document requiring a trustee send a copy of a Notice of Default or Notice of Sale concerning a specific deed of trust in foreclosure to the person who filed the document.

Subject To
The purchase of a property with an existing lien against the title without assuming any personal liability for the liens payment.

Title
The instrument that is evidence of a person's right in real property (i.e., a deed).

Trustee
A neutral party who advertises the foreclosure property for sale and conducts the auction to sell said property to the highest bidder.

Trustee Sale
An auction of real property conducted by a trustee. Also known as a Sheriff's Sale.

Upset Bid
A recorded bid placed after a foreclosure sale has ended that is higher than the highest bid received at the actual foreclosure sale.

Writ
An order or mandatory process in writing issued in the name of a court or judicial officer commanding the person to whom it is directed to perform or refrain from performing a specified act.

BPO

Brokers Price Opinion

Short Sale

A sale of a house in which the proceeds fall short of what the owner still owes on the mortgage. Many lenders will agree to accept the proceeds of a short sale and forgive the rest of what is owed on the mortgage when the owner cannot make the mortgage payments. By accepting a short sale, the lender can avoid a lengthy and costly foreclosure, and the owner is able to pay off the loan for less than what he owes.

NEED to SELL and have NO Equity?

Are you struggling to make your payments?

Do you have questions that need to be answered?

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For the borrower(s) that are unable to maintain your mortgage payment(s)and need an option to avoid possible Foreclosure or worse Bankruptcy. Here are some hardships that may qualify for short selling a home.

MORTGAGE RELATED REASONS

No Equity available to Refinance
Interest Rate Adjusted
Balloon is due
Huge Negative Amortization

PERSONAL RELATED REASONS

Loss of Employment
Loss of Secondary Income
Medical Related Issues
Divorce or Separation
Military Transfer or Deployment
Job Relocation

Ann Urias - Short Sale Processor - Re/Max Short Sale Division

(714) 588-7676

www.ReMaxAnn.com for more info

Your Credit in a Foreclosure vs. a Short Sale - CALIFORNIA short sale specialist

Know that sellers will take a bigger hit on their credit report by going through foreclosure than going through a Short Sale.

Of course paying you mortgage with a few late payments and modifying your loan is the best course of action, however that topic is for a different blog.
FICO score may sway towards the following:

Foreclosure
A hit of 200 to 300 points may occur within the 3 different credit bureaus. This means if a seller's FICO score before foreclosure was 720, it could dip lower than 300. The seller has to also consider the initial dings from the lates caused prior to the end of the foreclosure.

Short Sale
The affect of a short sale on a seller's credit report is much less damaging. The ding on credit will show up as settled less then amount owed, some sort redemption status, or a few other different ways. But the result in the loss is about 60 to 140 points. This means a short sale with a previous FICO of 720 will see it fall to 550 to 600.

Estimated Waiting Period Before Buying Another Home

Foreclosure
When the seller now becomes a buyer it will take about about 60 months before a lender will offer a rate that you may consider. Of course at a purchase price of half of what you may have bought prior to this. But now with the constant daily guideline changes the lending industry is experiencing rates may not be economical for the buyer. Moreover, with the new restrictions of the guidelines the cure time and consequences may be worse.
"The presence of a foreclosure on your credit report probably will make it extremely difficult to obtain new credit at the best rates, especially if you also have problems with other credit accounts. A foreclosure remains on your credit report seven years to 10 yrs, so it will have a long-term effect on our creditworthiness."Experian - Credit Bureau

Short Sale
The good news for short sale sellers is that the wait is much shorter before buying another home. Short sale will show up on your credit for approx 3 years and you can build your credit with ease. Make sure to keep paying all other debit on time.

SHORT SALE your home before Foreclosure (Orange County)

Inform yourself of all of the possible pros and cons of "short paying" your home.
So you may choose the best options that will optimize your benefits for both you and your family.
Save your credit and look for a better future with the help of RE/MAX.

Hello, my name is Ann and I am from the Short Sale | Pre-Foreclosure Division.
Our consultation is absolutely FREE and confidential. My services are paid for by your lender.

We are here to help and our services will show that...

www.ReMaxAnn.com for more info on me.