If a debtor fails to make mortgage payments on time, he risks foreclosure. During foreclosure, the lender goes to court to reclaim the property and recover its loss. Ultimately, foreclosure results in the loss of the debtor's home as well as seriously affecting his credit rating and ability to find new housing. North Carolina offers free counseling to debtors facing foreclosure to help them avoid this possibility.
State Home Foreclosure Prevention Project
The State Home Foreclosure Prevention Project, or SHFPP, is a free program designed to help homeowners in North Carolina avoid foreclosure. This program offers financial counseling to North Carolina homeowners who may be in danger of foreclosure, and also provides legal services. Clients may speak with SHFPP in person or over the telephone to discuss their options or receive help with their loans prior to foreclosure.
Free Help
It is illegal in North Carolina to charge homeowners upfront for assistance with avoiding foreclosure. If a company claims to be a foreclosure assistance company but asks for money before providing services, report it to the attorney general's office. The attorney general of North Carolina has set up a hotline at 1-877-5-NO-SCAM (1-877-566-7226) where consumers can report foreclosure scams, and also has placed a complaint form online (see Resources).
When to Get Help
Seek help as soon as you fall behind on your mortgage payments. Once you miss three payments, your lender may begin foreclosure proceedings. You do not want to ignore your mortgage or letters regarding your mortgage, as your bank can begin foreclosure proceedings if you do. SHFPP can help you even if you have received a final notice from your lender, but it is best to contact them prior to this point to avoid stress and the risk of foreclosure.
Foreclosure Process
If you are more than 15 days late with your mortgage payment, you may get a letter of default from your lender. The lender may send you a letter once every 30 days until you settle your account or enter foreclosure. After 90 days, your lender may send you a demand letter telling you how much you owe and informing you that if you do not make payment arrangements by a certain date, you will enter foreclosure. Next, you get a letter informing you of a hearing date and time regarding the foreclosure. You must receive this letter at least 10 days before the hearing. You may also get a notice of sale, although this notice can also be served later. The notice of sale must come 20 days before the sale of your home. After your home is sold, you will receive a notice informing you of how much time you have to buy it back before the court finalizes the foreclosure.
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