Foreclosure Process

By Author: Thomas Mietzel
Total Articles: 13
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As a result of the economic crisis, many home owners have been unable to keep up with their mortgage payments. Because the property was used as collateral in obtaining the mortgage loan, in case of default the lending institution may be left with no other viable option than to foreclose on the mortgage or deed of trust and put the property up for sale. This is a complex legal procedure, and all the applicable laws and conditions must be carefully followed. If you are considering the purchase of Madison real estate via a foreclosure sale, it is important to understand the factors involved. There are Madison realtors who specialize in this type of property, with the experience and know-how to guide you. The following is a brief step by step description of exactly what the foreclosure process in the state of Wisconsin entails.
Judicial vs. non-judicial foreclosures
Laws governing foreclosure proceedings vary from state to state. In the state of Wisconsin, both judicial and non-judicial foreclosures are allowed. A non-judicial foreclosure, the simpler of the two procedures, occurs when the original loan contract included ...
... a clause permitting the lender to sell the property if the loan is defaulted on. This power of sale clause may state the terms and even the time and place of sale, should it be necessary. Lacking such a clause, the lending institution must go through the court system and have the judge rule whether to release the property to the lender; this is called a judicial foreclosure.
Length of the proceedings
Whichever type of foreclosure is appropriate, the procedure takes time. The correct paperwork must be filed with the court to begin with; then the period known as pre-foreclosure will begin. The property’s current owner must be notified that foreclosure proceedings have been initiated. After that, there is a waiting period of six weeks to one year before the house can be sold, depending on the type of foreclosure. However, if the present owner agrees to the sale, the property can be offered for sale immediately. Wisconsin’s laws make for one of the longest foreclosure procedures in the country.
Sale of the property
Once the waiting period is complete, the house will be auctioned by the sheriff. Anyone wishing to bid on the property must have on hand at the time of the auction at least ten percent of their highest bid. This amount must be paid to the sheriff by the winning bidder as a down payment. The buyer then is allowed ten days to pay the balance owing in full. Please note that, in the case of a non-judicial sale, the original owner is given 365 days to pay the total amount, plus interest, to the winner of the auction and reclaim the home, unless certain conditions apply. So you can see that buying Madison property in foreclosure is complex indeed. Choose one of the qualified Madison realtors to help you. This ensures the minimum hassle, and the maximum satisfaction with your home purchase.

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