Foreclosure is when the lender takes back the property after the homeowner fails to make required payments on a mortgage.
Foreclosure processes differ by state. In some states, the lender has to go to court to foreclose on your property (judicial foreclosure), but other states do not require a court process (non-judicial foreclosure). Generally, borrowers must be notified if the lender or servicer begins foreclosure proceedings. Under federal law, a servicer generally cannot start the foreclosure process until your loan is more than 120 days past due. There can be exceptions depending on your forbearance or other mortgage relief (often called “loss mitigation programs”).
Effective August 31, 2021, servicers generally cannot start the foreclosure process until January 1, 2022, before reaching out or evaluating your complete application for options to help you avoid foreclosure.
If your servicer contacts you near the end of your forbearance, they generally must tell you:
- The date your forbearance program will end
- Your options for repaying your missed payments and avoiding foreclosure
- Information on how to contact free housing counseling services
Exceptions apply, so be sure to stay in contact with your mortgage servicer. Avoiding their calls might speed up foreclosure. For example, a servicer may be able to start the foreclosure process if they are unable to reach you after trying for three consecutive months.
Foreclosure moratoriums suspend or stop foreclosure.
If your loan is backed by Fannie Mae, Freddie Mac, HUD/FHA, USDA, or VA, your lender or loan servicer could not foreclose on you until after July 31, 2021.
Specifically, the guidance from Fannie Mae and Freddie Mac, HUD/FHA, VA, and USDA prohibited lenders and servicers from beginning a judicial or non-judicial foreclosure against you, or from finalizing a foreclosure judgment or sale. This protection began on March 18, 2020.
If you are a homeowner with a foreclosure-related eviction, you generally can’t be evicted until after September 30, 2021.
, , , and the , have extended certain foreclosure-related eviction moratoriums through September 30, 2021. So if you have lost your home through the foreclosure process, you generally won’t be required to leave your home until after September 30, 2021.
If you want to learn more
Your servicer can work with you to avoid foreclosure. If you’re not in forbearance and are behind on your mortgage, forbearance may still be an option. So, it’s important to contact your servicer immediately as well as a housing counseling agency.
Get expert help
Talk to a housing counselor
For help talking to your mortgage servicer or understanding your options, contact a HUD-approved housing counseling agency in your area. Housing counselors can develop a tailored plan of action and help you work with your mortgage company, at no cost to you.
Talk to a lawyer
If you need a lawyer, there may be resources to assist you, and you may qualify for free legal services through legal aid. If you’re a servicemember, you should consult with your local Legal Assistance Office.
Submit a complaint
If you have a complaint with your mortgage or forbearance plan, tell us about your issue—we'll forward it to the company and work to get you a response, generally within 15 days.