Federal Housing Foreclosure

This article contains information on federal housing foreclosures.  It discusses the types of foreclosures and how to avoid foreclosure.

 Foreclosure has become all too familiar for homeowners around the country during these days of a struggling economy. By definition, foreclosure is the repossession of property from a property owner by a lending agent.

The property can be anything of high value but is usually cars and houses. The lending agents are real estate personnel and even the federal government. Repossession can occur because the contract or lease’s terms could have been disregarded by the party that needed the lease.

Putting up a piece of property such as a car or house to assure a lending party that the contract will be followed through on is also known as collateral. Federal housing foreclosure is simply when the government or a government agency repossesses a piece of property and then auctions it off to pay for the unpaid mortgage.

Types of Foreclosures

\Foreclosure is negative in every sense of the term and there are two different types of foreclosure that can have a piece of property repossessed and then sold for profit.

\Judicial Foreclosure is foreclosure that takes place under the supervision of a court. The house or car is auctioned off for money which is then split three ways. The first part of the proceeds pay off the remainder of the mortgage, the second part of money goes to any other lending holders. If there is any money left over after the first two parties are paid off the remainder goes to any final mortgage holders involved with the original deal.

The second type of foreclosure is called Power of Sale. This is the sale of a piece of property without the supervision of a court. For this to take place a Power of Sale clause must be included in the contract that describes the mortgage. The mortgage holder and any other lending parties involved in the deal get first crack at whatever money comes from the sale of the piece of property.

How to Avoid Foreclosure

Many people across the country today are struggling to make ends meet because they are either unemployed or don’t make enough money to pay the mortgage on their home. There is plenty of advice available today to help people avoid foreclosure but it might be difficult to filter through the best advice.

Before any decisions are made involving selling or buying a home one should always consent a housing counselor. Housing counselors can inform home owners and soon-to-be home owners what the best options are when negotiating with a lender, help protect the homeowner protect themselves from future credit problems and provide information regarding programs in a homeowners local area that provide legal and financial assistance.

The United States government has been working on different bills over the past couple of months to aid homeowners in keeping their property and avoiding foreclosure. Speaker of the House Nancy Pelosi announced on July 30 that a new bill was signed into law regarding the growing housing problems within the country.

That new bill is called The American Housing Rescue and Foreclosure Prevention Act, H.R. 3221. The bill ensures that homeowners will be able to keep their homes by refinancing their mortgages into lower-cost government-issued mortgages that the homeowners would be able to afford.

Federal housing foreclosure has become a widespread epidemic in the United States but with this new bill that has been signed into law, the country should hopefully be seeing some relief in the housing market sooner rather than later.