ABA Family Legal Guide

Home Ownership

The Financial Side of Home Ownership

Understanding Your Mortgage

What happens when a lender forecloses on the mortgage?

The law varies by state, and these differences have a critical impact on the homeowner's rights. That's why it's important to consult a lawyer in your state as soon as you can. In general, if the lender forecloses, all your rights to your home will end immediately or soon thereafter. This may be in no more than six months, though some states have a more lengthy process, including rights of redemption.

State laws do provide homeowners with certain protections. In Illinois, for example, when a foreclosure suit is filed, the homeowner has ninety days to make up the back payments to reinstate the mortgage. After that date, the lender can legally require that the mortgage be paid in full within seven months of the original foreclosure notice. The important thing to remember is that you must act immediately to protect your home if your lender intends to foreclose.