If a homeowner should happen to become delinquent on their mortgage payment for 3 consecutive months, a Notice of Trustee Sale or Notice of Default is issued by their mortgage company. The home is then considered to be in „pre-foreclosure“ after these documents have been issued by the mortgagor.

The property will keep said classification until one of a few different things happen, after the home or property has been termed as a „pre-foreclosure.“ The owner may bring the mortgage payments up to date, they may get approved to modify their loan with their lender, the home may be sold in a „short sale, “ which is selling the home for less than what the owner owes, or the home may be sold by the bank through a Trustee Sale Auction.

A pre-foreclosure in essence does not covert to an actual foreclosure until the property is sold at auction through a Trustee Sale. This kind of home sale is only legal in 13 states, one of which is Arizona. A Trustee Auction sale is considered a non-judicial action. The other type of foreclosure is called a judicial foreclosure. For the purposes of this article, only the non-judicial type of foreclosure is dealt with.

The Notice of Trustee Sale, as previously described, initiates the pre-foreclosure stage of the process. Such a notice is a public notice, recorded document which states the Mortgage Firm or Lender’s intention to retake possession of the property personally or to sell the property via an Auction. Every group which maintains an interest in the property has the legal rights to foreclose on the property in question too, including Homeowners Associations, additional mortgage holders, County Assessors, or Contractors.

When the owner has been notified of the Notice of Trustee Sale, they are considered in „pre – foreclosure,“ status. For Tucson foreclosures, the home cannot be sold or auctioned until a minimum of 90 days have passed since the Notice of Default is issued. This permits the homeowner a window of opportunity to renegotiate their mortgage and modify their loan, become current on their missed mortgage payments, or negotiate a short sale and stop any further foreclosure action.

It is very important for homeowners who are in a situation where pre-foreclosure or forclosure are imminent to seek the advice of an attorney so they know what their legal rights are. A bankruptcy filing can sometimes postpone a Trustee Sale but again legal advice is highly recommended.

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