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LegalGems
LegalGems, Attorney
Category: Estate Law
Satisfied Customers: 7451
Experience:  Private Practice; Elder Law Attorney; Estate Planning; Attorney Mentor
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I need to know about the foreclosure laws on property of a

Customer Question

I need to know about the foreclosure laws on property of a deceased person. Should the loan have gone immediately into foreclosure at my mothers death or now 3 years later when the payments were not made. They have since been brought current, but I am told that it will remain in foreclosure anyway and the property must be sold in 120 days
Submitted: 10 months ago.
Category: Estate Law
Expert:  LegalGems replied 10 months ago.

Thank you for requesting me.

A death in and of itself does not cause a property to go into foreclosure. There is a federal act called the Garn St Germain Depository Act (https://www.law.cornell.edu/uscode/text/12/1701j-3) which was enacted to prevent relatives from losing their home upon the death of the deceased owner.

Basically, the federal law precludes the lender for accelerating the Due on Sale clause, which used to include death as a triggerring event. Now, the law provides that a relative may take over the loan without additional fees or refinancing, precisely to allow relatives to remain in the house.

A property only goes into foreclosure when it becomes delinquent. The personal reprsentative (ie executor if there is a will, trustee if there is a trust; personal representative if there is neither) is to make the payments while probate is pending.

A HUD consultant through the government can be reached here: http://portal.hud.gov/hudportal/HUD?src=/i_want_to/talk_to_a_housing_counselor

Most lenders will work with the interested parties to avoid foreclosures, particulary if the loan has been brought current.

Here is a link to locate an attorney:
http://apps.americanbar.org/legalservices/findlegalhelp/home.cfm

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