Foreclosure: What it is and How to Avoid it

Foreclosure: What it is and How to Avoid it

Foreclosure: What it is and How to Avoid it

By Mark Spain Real Estate

No homeowner wants to experience the nightmare of foreclosure. That said, it’s important to take preventative measures to ensure foreclosure is not your fate. Even if you’ve missed a home payment or two, our experts have some solutions to increase your chances of keeping your home and avoiding foreclosure. 

At Mark Spain Real Estate, we want to see homeowners succeed. Whether you’re considering buying a home and want to learn about foreclosure or are on the brink of foreclosure and looking for solutions, our experts are here to help you cover all your bases. Below, we’ve compiled a guide defining foreclosure and offering ways to avoid it. Check it out!

Foreclosure: What it is and How to Avoid it 

What is Foreclosure?

Foreclosure occurs when a homeowner misses their mortgage payments. As a result, that homeowner’s mortgage lender or bank will take legal possession of their property and attempt to sell it to recover their financial loss. When taking out a home loan, borrowers sign a mortgage agreement stating that missed monthly mortgage payments will lead to repossession. A foreclosure Foreclosure occurs when a homeowner misses their mortgage payments.

Foreclosure laws vary from state to state, with some classifying the foreclosure process as judicial and some as non-judicial. Some states also have options for both. A judicial foreclosure is when the lender files a lawsuit to initiate the foreclosure. The borrower can then go to court to argue the suit. Meanwhile, non-judicial foreclosures don’t involve court hearings. In these cases, a lender can auction off the home after the warning and waiting period outlined in the state’s laws because of the mortgage agreement’s power of sale clause. 

How Long Does Foreclosure Take?

Foreclose periods will vary based on state laws. On average, between the first public notice and the end of the foreclosure, the number of days for foreclosure was 1,212 in mid-2023. Some states with the longest foreclosure periods during this time were Michigan, Louisiana, New York, Hawaii, and Kentucky, with the longest duration being 2,601 days. Meanwhile, states with the shortest foreclosure timelines were Wyoming, Minnesota, Montana, Texas, and Missouri, with the shortest duration being 104 days. It’s important to note that the states with longer foreclose periods typically enforce judicial processes, while those with shorter timelines are non-judicial.

How Can I Avoid Foreclosure?

Even after missing a mortgage payment or two, borrowers can still avoid foreclosure with the right course of action. Below, we break down some options available for those on the brink of foreclosure wanting to save their fate. 

Mortgage Reinstatement

Requesting a mortgage reinstatement is the fastest way to catch up on missed mortgage payments. Borrowers who have requested reinstatement have the opportunity to pay back everything they owe, including missed payments, interest, and penalty expenses, by a specific date to get back on track and resume their mortgage payments as normal moving forward. 


Borrowers can request a forbearance if their missed payments are due to temporary financial obstacles, such as hospital stays or layoffs. If their forbearance is granted, borrowers can pause or lower their monthly payments temporarily to rebuild their savings. Then, they can resume regular payments once they’re back on track. However, borrowers still accumulate debt during a forbearance, so many choose to implement repayment plans or loan modifications when their forbearance period ends. There are multiple ways you can avoid foreclosure.


Refinancing is a preventative measure if you’re at risk of missing mortgage payments. This involves speaking with your lender about altering your refinancing options to a more affordable rate. People opt for refinancing when they barely make their payments and want to ensure they don’t enter foreclosure. However, it’s important to note that refinancing is not an option once you’re already in foreclosure. This is a preventative measure only. 

Repayment Plan

Repayment plans are a short-term solution to catching up on your mortgage payments. Generally, when a lender agrees to a repayment plan, the borrower will have to add a portion of their past-due payments to each of their monthly mortgage payments until they’re caught up. These plans usually only last for three to six months maximum. 

Short Sale

Opting for a short sale means you would sell your home for less than you owe on your mortgage. Then, your lender would receive all of the sale proceeds. To conduct a short sale, you must first get approval from your lender by proving that you are financially struggling and that your home’s market value is less than your outstanding mortgage balance. Short sales generally are not a popular choice among borrowers, as they can hurt your credit score and leave you without a home or any sale profit. 

Sell or Buy a Home with Mark Spain Real Estate

Are you looking to buy or sell a home? Allow us to do the heavy work! The industry professionals at Mark Spain Real Estate are determined to help you meet your real estate goals. Our team of experienced real estate agents delivers unparalleled customer satisfaction and promises a seamless, stress-free selling or buying experience! 

Check out our Guaranteed Offer Program! Our guaranteed offer participants receive the most competitive all-cash offers in the industry and close in as little as 21 days. Contact our agents today to learn more about our Guaranteed Offer Program and sell your home hassle-free!

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