Mohamed Ibrahim’s Blog

This is a good news for home owners with financial troubles. A plan was announced today called “Project Lifeline” that will enable homeowners to slow down the foreclosure procedures by 30 days. In some states like Maryland, the foreclosure procedures are considered on of the fastest nationwide. Such slow down is beneficial in case the homeowner was able to communicate with the bank and arrange an alternative solution, or figure out a way out of foreclosure and repay the loan.

Foreclosure is a horrible thing. It happens due to either a mistake where a home buyer buys a property larger than what he can afford, or due to financial problems like losing income. After the borrower can’t make his payments, the lender asks the court to auction the house to repay the loan. It is a process by which lenders try to recover their losses by auctioning the home and is done differently in different states. That does not mean that foreclosure is an entire remedy to the lender, actually the lender can sue the borrower if they didn’t cover their loss from the money made in the auction, and at that case the borrower will sometimes end up by filing bankruptcy since he/she usually won’t have enough to pay.

(more…)