Foreclosure in any aspect is a negative situation. No homeowner will ever want to foreclose their home because of any financial crisis. But if the situation of foreclosure occurs the homeowner should be aware of the procedure of how to stop foreclosure in South Carolina. Facing foreclosure is an awful situation. There are two ways through which the Foreclosure process takes place: Judicial and Non-Judicial. South Carolina allows judicial foreclosures. The foreclosure process has to follow state laws.
If you are currently in foreclosure it’s important for you to know, how you can stop foreclosure from taking place. There are various options you can opt for to stop a foreclosure from happening.
What Does Foreclosure Means?
Taking a loan from a bank or a lender to buy a house or property is very common everywhere. Paying back the borrowed amount in the given time duration is also very important. If someone fails to pay back the loan amount, the foreclosure situation is very likely to come into existence. Foreclosure begins after the very first missed payment.
Foreclosure can also happen if the homeowner fails to pay the property tax levied upon them. There are various reasons for falling behind in payments like, financial crisis, medical emergencies, and sudden loss of job.
Introduction to Foreclosure in South Carolina
The foreclosure crisis peaked in 2010. The foreclosure process and mortgage services were heavily supported by state and federal laws after that. In South Carolina, people must sign a promissory note and mortgage when they take a loan to buy property. These documents give people some contractual rights as well.
South Carolina foreclosures most likely give you the right to many benefits. They are:
- Receive notice in the form of a breach letter before foreclosure.
- You can apply for loan mitigation.
- If you are in the military, you will get special protection.
- Get notified about the foreclosure and chance to respond legally.
- Pay off your debt to prevent a foreclosure sale.
- You can redeem the property after the sale.
- Get any excess money after a foreclosure sale.
Key Points About South Carolina Foreclosures
- Primary Security Instrument- Mortgage
- Judicial Foreclosure- Yes
- Non-Judicial Foreclosure- No
- Right of Redemption- No
- Timeline- Varies
- Deficiency Judgements Allowed- Yes
Ways to Stop Foreclosure in South Carolina
There are ways of stopping home foreclosures in South Carolina that you need to know. Let’s cover them all:
Declare Bankruptcy
Yes, bankruptcy is a way through which foreclosure can be stopped. But you need to understand the concept of chapter 7 and chapter 13 of bankruptcy.
Chapter 13 bankruptcy in South Carolina: It is a common option to go for to stop foreclosure. According to chapter 13 bankruptcy, you are given a payment plan of 3 or 5 years to catch up with the payment in arrears. The lenders will be given orders to stop going forward with the foreclosure process. They will have to give you time to get back to your payment arrangements.
Chapter 7 bankruptcy in South Carolina: It is a liquidation form of bankruptcy. Unless you want the South Carolina bankruptcy trustee to sell your house, it may be a less common option to pursue. Even though it is the lower-cost bankruptcy option, you still may not want to opt for this option.
You need to understand what your payment plan is. Is your payment plan regarding chapter 13 bankruptcy worth pursuing? For instance: you have $150,000 in arrears on your house and your payment plan is for 5 years / 60 months. Will you be able to pay an additional $2,500 every month to cover your arrears?
Applying for Loan Modification
It has become difficult to fully pay off the mortgage payments. There are many reasons why you can miss out on payments or get late in paying the mortgage. Before this unwanted thing happens, you may go to your lender and find out if they consider a loan modification option.
Reinstating Your Loan
Do you have enough cash to pay off all the loan amount? Approach your lender with cash. See if they accept the payment and permit you to continue paying your loan amount without any legal interference. Lenders only want to recover the loan amount and so they will accept your offer.
» Direct Mortgage Lenders in South Carolina: Click to know about the best mortgage lenders in South Carolina.
Plan for Repayment
Great! You can make payments again after missing out on some payments. Find out what your lender thinks regarding your repayment plan. In the repayment plan, you are allowed to pay the missed payments slowly along with the current mortgage payments. You can come up with an agreement on the repayment plan to stop foreclosure. According to this, you agree to pay your missed payments along with the normal payments.
Refinancing
Refinancing may be a difficult option to consider. Interest rates are going up only making it difficult to think of loans. You can start with a new lender which means a whole new agreement. There may be one drawback. It might become difficult to qualify for refinancing if your credit score is negatively affected.
Sell Out Your Home
It’s really sad even to think of selling your house. But it is actually a good option to consider selling your home to avoid foreclosure. You may receive an amount more than the actual price of your home. Perhaps you could even buy a house worth more than the one you sold. You can stop something drastic from happening and your credit report will also not get spoilt.
» How to Sell a House in South Carolina: Read the blog to know about how you can sell a house in South Carolina.
Short Sale
A short sale means that you can sell your home for an amount that is less than the amount you owe. The reason behind this is that sometimes your home is sold for a lesser amount in the auction. The bank/lender is sometimes not able to recover the whole amount they are hoping for. Home staging companies in South Carolina can help you get more than the asking price.
Deed In Lieu of Foreclosure
A deed in lieu of foreclosure takes place when the homeowner transfers the property to the lender. The homeowner hand over the property to the lender, clearing all the debts they owe. The property is then owned by the lender. You have to vacate the property as soon as possible. This way you can easily save yourself from any damage.
Frequently Asked Questions
How long does a foreclosure take in South Carolina?
Four to Six months:
How long does foreclosure take in South Carolina? If the foreclosure sale is uncontested, foreclosure generally takes four to six months. If contested, foreclosure takes much longer depending on the facts of the case.
What is the foreclosure process in SC?
South Carolina law says that all foreclosures must be done in court and only a judge can order the sale of your house. Therefore, if you fall behind in paying your mortgage, a lender will file papers with the court and ask for permission to take your home and sell it to cover the loan.
What is foreclosure intervention in SC?
Foreclosure intervention is a South Carolina process to ensure that lenders and eligible homeowners have an opportunity for meaningful discussion about possible settlement options. Settlement options may include a loan modification, short sale, deed in lieu of foreclosure, etc.
What happens after a foreclosure hearing in SC?
Foreclosure Hearing and Judgment:
If the court determines that the foreclosure is proper, it will enter a judgment against the homeowner. If the homeowner doesn't file an answer, the lender will likely get a default judgment, which means the lender wins the case.
Also Read
- How to Stop Foreclosure: Read the blog to know how you can stop foreclosure on your property.
- How to Avoid Foreclosure: Find out the ways by which you can avoid foreclosures so that you don’t have to face the foreclosure situation.
- Who Pays Closing Cost in South Carolina: Click to know who pays closing costs after the property is sold.
- How to Buy a House in South Carolina with Bad Credit: Know how you can go for buying a house in South Carolina even with a bad credit score.
Recommended
- Sell My House Fast for Cash: Check out this blog to see how you can sell your house fast for cash.
- How to Sell Your Own Home in South Carolina: Read to know how you can sell your home in South Carolina.
- South Carolina Cash Offer: Read the blog to know about the South Carolina cash offers in houses and it’s importance.
- Who Pays for Title Insurance in South Carolina: Find out who pays title insurance in South Carolina.
- How Long Does a Preapproval for a Mortgage Last: Know about all the details of the Preapproval of Mortgage loan.
