Results 1 to 4 of 4
    • Member Info
      • Native Language:
      • English
      • Home Country:
      • Ireland
      • Current Location:
      • Ireland

    • Join Date: Mar 2011
    • Posts: 37
    #1

    Foreclose

    Help!

    If John has a mortgage from Acme Bank on his house. Because John can't repay his mortgage, the bank moves to repossess John's house.

    Is the bank foreclosing on the loan or the property or both?

    In respect of mortgages, "foreclose" is defined as follows

    "a. To deprive (a mortgagor) of the right to redeem mortgaged property, as when payments have not been made.
    b. To bar an equity or a right to redeem (a mortgage)."
    foreclose - definition of foreclose by the Free Online Dictionary, Thesaurus and Encyclopedia.

    • Member Info
      • Native Language:
      • American English
      • Home Country:
      • United States
      • Current Location:
      • United States

    • Join Date: Apr 2009
    • Posts: 12,307
    #2

    Re: Foreclose

    Foreclosure - Wikipedia, the free encyclopedia

    Not that it matters much if you are in this situation, but it is the loan that is foreclosed. Well, technically, the lender "the lender seeks to foreclose (in plain English, immediately terminate) the equitable right of redemption and take both legal and equitable title to the property in fee simple."

    You will see reference to homes that are for sale that have been "foreclosed," so it's not like people are making such a fine distinction between the loan or the home being the object of foreclosure.

  1. BobK's Avatar
    • Member Info
      • Native Language:
      • English
      • Home Country:
      • UK
      • Current Location:
      • UK

    • Join Date: Jul 2006
    • Posts: 16,038
    #3

    Re: Foreclose



    Think about it: fore + close

    Intitially, the lenders said 'You can have this loan for N years, provided you pay $X every month'. But 5 years before N, they say 'Since you're not keeping up with the payments, we are going to close the loan facility before N.' Foreclosing has nothing to do with closing a property - although foreclosing on a mortgage on commercial property may have the effect of closing down a business.

    b

    • Member Info
      • Native Language:
      • English
      • Home Country:
      • United States
      • Current Location:
      • United States

    • Join Date: Jan 2010
    • Posts: 1,696
    #4

    Re: Foreclose

    Quote Originally Posted by SoothingDave View Post
    Foreclosure - Wikipedia, the free encyclopedia

    Not that it matters much if you are in this situation, but it is the loan that is foreclosed. Well, technically, the lender "the lender seeks to foreclose (in plain English, immediately terminate) the equitable right of redemption and take both legal and equitable title to the property in fee simple."

    You will see reference to homes that are for sale that have been "foreclosed," so it's not like people are making such a fine distinction between the loan or the home being the object of foreclosure.
    I can see why the article referenced is labeled as "may confuse". In a foreclosure, a lender seeks to demand that all of the conditions of the loan be fulfilled. One of the conditions of the loan is that payments be made on a regular and agreed upon basis. If these payments are not made, the lender may demand either that the full amount be paid within a certain time (such time being a matter of state law), or that they gain legal title to the property. The matter of redemption should not have been mentioned in this article as it is a side issue to the foreclosure process. In states which allow redemption, an owner (or borrower) has the right to pay the lender the amount due after a foreclosure (up to six months in some states). The effect of the right of redemption is that a lender may foreclose on a property, sell the property to another person and then the original owner may pay the lender and re-take legal title to a property. In addition, the title issued after a foreclosure may not be in fee simple (regarded as the highest type of ownership). In many cases a Sheriff's Title may be issued. A Sheriff's Title is considered to be constructive knowledge that there may be others who have a legal claim on the property - such as the original owner who may act under the right of redemption.

Similar Threads

  1. foreclose
    By masterding in forum Ask a Teacher
    Replies: 4
    Last Post: 26-Sep-2011, 14:12

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •