What happens after foreclosure depends on what you do today. You see, the three deadly sins of the credit report world are foreclosure, bankruptcy, and eviction. All too often, people facing foreclosure end up with all three on their record.
In an extremely bad situation, what happens after foreclosure is that the ex-homeowner stays in the home forcing the new buyer to file an eviction against them.
Simultaneously, the bank is preparing a Deficiency Judgment which is the difference between the auction amount and the sale amount. The ex-homeowner, faced with a bill of tens or hundreds of thousands of dollars must then file for bankruptcy.
Another bad situation is where a homeowner files for bankruptcy protection in order to save their home. Then, they are unable to make the payments fall out of bankruptcy protection. As a result, they get foreclosed upon. If they remain in the home, they are also evicted.
So, what happens after foreclosure depends on how you set things up.
If you know you are going to lose your home, try to do a workout with the bank. This might involve a short sale or a Deed in Lieu of Foreclosure. If you are not getting anywhere with your bank on your own, you can use a foreclosure assistance firm.
If you decide to pursue bankruptcy to clear out other debt in an attempt to save your home, make sure that you are able to make the required payments. Many, many people facing foreclosure set up a Chapter 13 bankruptcy and then fall out.
If your goal is to stay in the home payment free for as long as possible without making any payments (one man did it for 11 years!) then you need to be making “house payments" to your savings account. You should also rent a new place before you are served with an eviction notice which is the kiss of death for most landlords.
What happens after foreclosure is that you move on with your life. But if you make good decisions before foreclosure, that will be a lot easier.
If you're facing foreclosure and need to know what happens after foreclosure as well as what happens during the process, you need to get your hands on the new free report The Foreclosure Survival Guide today. This guide describes the steps of foreclosure and details all of the options you have as a homeowner.