When Maine homeowners purchase a home and acquire a mortgage, they probably envision paying off the mortgage within thirty years or less. At that point, they will fully own the property they worked so hard to acquire, and turn it into a real home. Unfortunately, many people are not able to actualize that dream. There is a growing segment of property owners who are experiencing foreclosure. The people who are currently in the process of foreclosure and people who believe a foreclosure is imminent, need to understand ME mortgage foreclosure laws.
When homeowners acquire a mortgage, the mortgage lender puts a lien on the property. If the homeowner stops making mortgage payments, the lender will be able to sell the property to recoup their money. After a certain number of payments have not been received, the lender has the option to begin foreclosure proceedings. There are certain steps the lender must complete in order to properly begin the foreclosure process.
The lender must first send the homeowner a Notice of Right to Cure Default. This notice has to be sent at least thirty five days prior to the official start of foreclosure proceedings. The notice will let the borrower know he has the right to bring the account current. The notice will have an itemized list of the past due payments and will list the remaining outstanding balance of the mortgage. The notice will inform the borrower of payment options, such as a repayment plan or a possible loan modification. Information regarding how to request a court-supervised mediation will also be included.
If the borrower is not able to pay off the full delinquent amount within thirty five days, he should contact the lender to discuss different payment options. The borrower can also find out if he will qualify for a loan modification. The borrower should try to work out a payment plan or initiate the loan modification process before the notice expires. If the lender and borrower do not reach a resolution by the time the notice expires, the lender can officially initiate foreclosure proceedings.
To start foreclosure, the lender will file a lawsuit with the court and the homeowner will be served with a Summons and Complaint. If the homeowner wants to contest the foreclosure or set up mediation, then he needs to complete and submit the Answer form included with the Summons and Complaint. The Summons and Complaint will include a date which states the date by which the Answer needs to be filed.
If the homeowner raises valid arguments and defenses in the lawsuit, then a trial date will be set and a judgment will be issued. If a court-supervised mediation was requested, that will be set up. If the borrower does not file an Answer or if a trial is held and a judgment is entered against the borrower, there is still a chance to keep the property.
After a judgment is entered against the homeowner, there is a ninety day right of redemption period. Right of redemption means the homeowner has ninety days to completely pay off the mortgage plus any additional legal fees and costs. The borrower is permitted to stay on the property during the ninety days. The homeowner can also sell the property within the ninety day period. If the property is sold by the borrower, the sale must cover the cost of the mortgage, legal fees and costs, unless the mortgage lender contractually agrees otherwise.
If arrangements are not made to sell the property or pay off the mortgage by the time the redemption period expires, the mortgage lender can have the borrower evicted from the premises within forty eight hours. The lender will set up a date and location for a public auction. If the lender does not get enough money from the sale to cover all of their costs, they may hold the borrower responsible for paying off the remaining delinquent amount. If all of the debt obligations have been satisfied from the sale, the borrower may receive a portion of the sale proceeds.
Dealing with a foreclosure on a ME mortgage can be very stressful. A homeowner can consult with a real estate or bankruptcy attorney in order to find out about all of their options. An attorney will also be able to ensure all of the documents are filed timely and will make sure the lender has complied with all of their legal obligations.