What is a mortgage foreclosure and how does it affect a real estate dispute?

A mortgage foreclosure is a process in which a lender takes ownership of a property to satisfy an unpaid mortgage loan. It is a common tactic used in a real estate dispute in North Carolina. When a mortgage loan is not paid back by the mortgagee, the lender (the bank) initiates the mortgage foreclosure process. The first step in the process is for the lender to file a lawsuit in court. The court then issues a court order and sets a foreclosure date. The court order requires the homeowner to either pay off the loan or surrender the property. If the homeowner does not comply with the court order, the lender will then file for a foreclosure auction. In the foreclosure auction, the lender attempts to collect the unpaid loan balance by selling the property to the highest bidder. If the maximum amount of money is not recovered, the lender is allowed to keep the remaining balance via a deficiency judgment. This judgment can remain on the homeowner’s credit history for up to 10 years, and failure to pay this judgment can lead to further legal action. The mortgage foreclosure process can have serious long-term consequences for the homeowner. As soon as the foreclosure process begins, the homeowner’s credit score drops significantly. The foreclosure also stays on the homeowner’s credit report for 7 - 10 years which can make it difficult for them to obtain a loan for a new property in the future. As well, the homeowner will probably owe additional costs and fees.

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What is a mortgage foreclosure and how does it affect a real estate dispute?

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