Normally it’s been structured, such that, typically after a period of 90 days of non-payment, the bank will issue and record with the county what’s called a Notice of Default. From that timeline they are legally not allowed to do anything for a period of 90 days. What they can do once the Notice of Default has been recorded is after 90 days record what’s called the Notice of Trust Sale Date. That is the date they are posting is going to be your foreclosure date that is recorded at the county and from there, the foreclosure date or the auction date has to be set on a minimum of 21 days after the Notice of Trust Sale Date. On average the process takes 90 days + 90 days + 21 days around 6 and ½ months.
From there, in this real world environment, is that happening all the time? No. Every bank is a little bit different in regards to foreclosure process and their timelines. That is because they are dealing with numerous different variables such as people who want to apply for loan modification, for short sales etc. Every bank has their processing timeline right now in this real world scenario. I can state to you for example that there are banks like Bank of America who probably who probably averages about 8 to 10 months. But then again, there are some banks like Wells Fargo who are still very strict to stick to that 6 and ½ month timeline.
What does that mean to you? If you are considering a short sale, my advice to anybody considering it is starting it as soon as possible even if you only missed 1 payment. That affords you the highest probability of success on getting the short sale done before a foreclosure occurs. If you try to do a short sale a week or a few days or even a month before the foreclosure date, there is an opportunity where the bank may typically say “We are sorry, we’ve waited too long. We have simply decided to move on with the foreclosure process” and not entertain the short sale scenario. That’s definitely something to consider if you are thinking about a short sale, if you’ve missed any payments anything like that.
We can go into a little bit more in depth if you and I talk about your particular case and what might be done and the actual foreclosure timeline of your specific bank. But again, the average timeframe is about 6 and ½ months which means you need to get your short sale done in that timeframe in order for your short sale to be successful and to avoid foreclosure.
Thank you very much for listening this has been my presentation on How Long Does The Foreclosure Process Take.