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It is such an empty feeling when something so special and important is lost, such as car keys, cash or a loved pet, but when the house that’s called home is lost it hits so much harder than so many other things lost.

The reality is when a house is lost to foreclosure there really is only 2 options that can happen at the sale auction:

  • The lender (Big Bank) can take the property back, known as (reverting to the beneficiary)
  • An investor (3rd Party) can show up and purchase the property, by being the highest bidder.

The good news is if $100,000.00 was owed to a big bank and an investor bid $125,000.00 at the foreclosure sale then the former homeowner is entitled to any overbid money, in this case $25,000.00.  So at least if a homeowner loses their house they would receive a good amount of money following a foreclosure sale.

Now the bad news, in each situation whether the bank takes the property back or an investor buys the property at the foreclosure sale, each party will most likely want the former homeowner to move and move now.  There are some circumstances where the option to rent back is offered but this option is so often the exception to the rule.

No matter who got the property, if they choose they want the homeowner out then a decision needs to be made as to what needs to be done.  The law is very clear, the former owner possesses Occupancy to the Property and any new owner will need to bring an action called an Unlawful Detainer to petition a court to take away occupancy from the former owner and to award it to the new owner by issuing a Writ of Possession. 

The former owner has a number of options available to them such as:

  • Packing up and moving
  • Negotiating a Cash for Keys settlement
  • Fighting and delaying the eviction process
  • Filing a bankruptcy action

Each potential choice needs to be looked into as to any negative effect or consequences that each particular chose contains.

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