Request Foreclosure Help
Home Destination
If you or someone you know is facing foreclosure and is seeking to engage an experienced CDPE, feel free to contact me immediately, and I will respond to your request on a priority basis. Taking action as soon as you can ensures that you have the most and best options available.
×An alphabetical list of foreclosure short sale terminology
Foreclosure And Short Sale Terminology: help from Home Destination, to assist homeowners in understand foreclosure documents, proceedings, loss mitigation, and timelines, and guide you to your best solution.
A copy of the Notice of Foreclosure Sale must be published once a week for four weeks.
Arms Length
Borrowers can’t list the property or sell it to a relative or anyone else with whom they have a close personal or business relationship.
Bankruptcy-Chapter 7
Often called a straight bankruptcy-involves the liquidation of all non-exempt by the bankruptcy trustee, who in turn distributes the proceeds to qualified creditors. All dischargeable debts are discharged and the person(s) filing receive a ‘fresh start’.
Bankruptcy-Chapter 13
Often called a debt reorganization. A Chapter 13 Bankruptcy is generally appropriate for those individuals who have non-exempt property they wish to retain and who have enough income to reasonably pay the reorganized debt after covering reasonable living expenses.
Beneficiary
The beneficiary in a foreclosure context is generally the mortgage lender. Frequently referred to as the ‘Benny’.
BPO: Brokers Price Opinion
In the state of a Short Sale, a BPO is typically ordered by lender, is a property valuation report to help determine what the property might sell for.
DIL: Deed in Lieu of Foreclosure
The voluntary surrender of property by an owner/borrower to a lien holder that eliminates the need to continue foreclosure action by the lien holder. The lien holder can refuse to accept the Deed in Lieu and file a Notice of Non Acceptance with the County Recorder.
Discounted Payoff
The payoff of a mortgage loan where the lender accepts an amount less than the actual amount owed to payoff the loan.
Equity Deficient
A property is Equity Deficient when, if sold, sales proceeds would not fully pay off existing mortgage debt.
Forbearance Agreement
An agreement between a mortgage holder and a borrower that lays out a specific loan payment plan and puts a stop on the foreclosure action so long as the borrower meets the terms of the agreement. The payment plan includes provisions for repayment to the mortgage holder of all delinquent interest and fees and could include extending the life of the mortgage beyond it's original term. A Forbearance Agreement is a tool that allows the borrower to keep the property.
HAFA: The Home Affordable Foreclosure Alternatives
A government program and new tool to help homeowners avoid foreclosure. HAFA provides incentives for lenders and homeowners to carry out a short sale or deed-in-lieu of foreclosure.
HAMP: Home Affordable Modification Program
The HAMP is designed to help as many as 3 to 4 million financially struggling homeowners avoid foreclosure by modifying loans to a level that is affordable for borrowers now and sustainable over the long term. The program provides clear and consistent loan modification guidelines that are meant for the entire mortgage industry to use.
Judicial Foreclosure
A foreclosure action conducted through the courts instead of through a foreclosure trustee.
Junior Liens
A lien, usually a mortgage loan that is subordinate to a Senior Lien, usually a first mortgage. Lien priority is generally established by order of recordation. NOTE: if you refinance a 1st mortgage on a property with a 2nd mortgage already in place the new 1st mortgage holder will require a subordination agreement from Junior Lien holders to legally establish the new mortgage holder as 1st or Senior Position.
LIBOR: London Interbank Offered Rate
The interest rate charged among banks for short-term Eurodollars loans - LIBOR is a very common index for adjustable rate mortgages (ARM).
Loss Mitigation
Home mortgage lenders look to limit losses on delinquent mortgages by working out solutions with borrowers through their Loss Mitigation Departments.
Loss Mitigation Department
The department at the lender that is responsible for reviewing all short sale documentation, ordering a BPO, and approving or denying short sale.
Mailing
A copy of the Notice of Trustee’s Sale must be mailed (certified and first class) at least 20 days before the foreclosure sale to the borrower and to anyone who was entitled to receive a copy of the Notice of Default and Secretary of State and IRS, if applicable.
NAR: National Association of REALTORS®
Has urged the U.S. Treasury Department, the Federal Housing Finance Agency, Fannie Mae and Freddie Mac to improve the short sales process. The NAR is very proactive to help move the housing industry forward.
NOD: Notice Of Default
An official notice filed and recorded by a designated trustee at the request of a lender indicating lender has commenced foreclosure action.
NTS: Notice of Trustee Sale
An official notice that is posted, mailed, published/advertised and recorded by trustee at the direction of lender indicating lender’s intention to sell the property at public auction. The notice includes a specific date, time and location.
Posting
A copy of the notice of sale must be posted in a conspicuous place on the property to be sold at least twenty days before the sale. Also, a copy of the notice must be posted at one public place in the city where the property is to be sold at least twenty days before the sale.
Postponement
Trustee Sales may be postponed by the first at the direction of the lien holder. Notice may be given in advance or at the time and location specified for the intended sale.
PMI: Private Mortgage Insurance
A policy of insurance paid for by the borrower to protect the lender in the event the borrower defaults on the mortgage. Typically PMI is required by the mortgage holder when the down payment is less than 20% of the purchase price.
Qualifying Funds
In order to bid at a Trustee Sale bidder must have qualifying funds available at the sale. Qualifying funds are cash or a cashier’s check(s) drawn by a State or National Bank, a check(s) drawn by a State or Federal Credit Union or check drawn by a State or Federal Savings and Loan Association, savings association or savings bank specified in section 5102 or the Financial Code and authorized to do business in the State of Florida.
RASS: Request for Approval of Short Sale
After the borrower contracts to sell the property, the borrower submits a “Request for Approval of Short Sale” to the servicer within 3 business days for approval. If the borrower already has an executed sales contract and asks the servicer to approve it before an SSA is executed, the Alternative RASS is used instead. The servicer must still consider the borrower for a loan modification.
REO: Real Estate Owned
When a mortgage lender acquires a property, typically through foreclosure, it becomes real estate owned. Real estate owned or REO is a class of property owned by a lender, typically a bank, after an unsuccessful sale at a foreclosure auction.[1] A bank will typically set the opening bid at a foreclosure auction for at least the outstanding loan amount. If there are no bidders that are interested, then the bank can repossess the property legally. As soon as the bank repossesses the property through foreclosure, it is listed on their books as REO and is categorized as a non-preforming asset.
Reinstatement
To bring the loan current. Borrower may reinstate up to five (5) business days before foreclosure sale.
Short Sale
Typically faster and less expensive than a foreclosure. The sale of a home which is completed through negotiation with the existing lender(s) in which the lender(s) agrees to accept less than the full amount owed to satisfy the debt allowing the debt to be ‘paid off’, (short).
SSA: Short Sale Agreement
A SSA will be sent by the servicer to the borrower after determining the borrower is interested in, and eligible for, a short sale and the property qualifies. It informs the borrower how the program works and the conditions that apply.
Lean more about Minneapolis