My Lender Has Gotten a Final Judgment of Foreclosure. Can I Still Get a Loan Modification?
Many people get nervous when a Final Judgment of Foreclosure has been entered against their property. They believe that this is the end of the process, and all hope is lost. However, this is not the case. It is still possible to get a loan modification even after a Final Judgment has been entered. In fact, when a lender moves for a Final Judgment, they submit their figures for exactly what is owed, so it is at that moment when the most complete information is available. This can help us complete a loan modification analysis.
The Three Steps to a Final Judgment of Foreclosure
We are often asked about the process for entering a Final Judgment. It happens in three steps:
- Step 1. Your lender will send a Fair Foreclosure Act Notice to give you, the homeowner, one last chance to pay the arrears. This notice will say that your lender intends to apply for Final Judgment. However, if you send a letter within 10 days to say that you have a reasonable likelihood of getting the funds, your lender will wait an additional 45 days to give you a chance to pay.
- Step 2. Your lender will submit the application/motion for Final Judgment. This includes all the proofs of amount due and copies of the note, mortgage, assignments, and modifications. You will receive notice that you have 10 days to object to the amount due. Cases where the amount can be incorrect include:
- If there has been an insurance settlement paid for Sandy Damage, a fire, or other issues, and your lender took it but didn’t apply it to the amount due.
- If you have been paying the insurance and your lender has double-charged you.
- If there was a modification and your lender has not included it in the papers submitted.
- Step 3. About 30 days after the application/motion for Final Judgment is submitted, it will be reviewed and if there are no obvious errors, it will be approved. Once Final Judgment is granted, your lender can apply for a sheriff sale. The amount of time from the final judgment to sale varies in each county. You can contact your county sheriff’s office to ask how long it takes a sale to get scheduled.
Can a Loan Modification Stop a Final Judgment?
- If you have not already been reviewed for a modification by your current lender, and a complete loan modification application is submitted prior to the application for Final Judgment, your lender must review the application before they apply for Final Judgment.
- If you have not already been reviewed for a modification by your current lender, and a complete loan modification application is submitted after the application for Final Judgment is submitted, but before it is granted, your lender should withdraw the Final Judgment papers to review the modification application.
- If a complete loan modification application is received by your lender at least 38 days prior to the Sheriff Sale, and there has not been a prior modification application reviewed by this servicer, they must adjourn the sale and review the application.
If you have any questions about your options for getting a loan modification, contact Ira J. Metrick today. We can conduct a thorough analysis of your eligibility for a loan modification. Based upon information about your loan and you, we can determine if you are eligible for a loan modification, and we can give you an estimate of the modification payment terms.
