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I certainly understand your concern. Once the lender actually forecloses, you will be served with a summons and complaint, putting you on notice that a cause of action has been filed against you and that you need to respond. As far as the issue with the loan modification, the lender can request that money be paid up front, to modify the loan. If the money is not paid, the lender does not have to agree to a loan modification at this time. This is not to say something will not be agreed upon down the road but if they wanted some money up front, it should have been stated in the loan modification paperwork ,which they wanted you to sign, as a condition for it. If they do foreclose, you can always ask, if the court does not automatically require it, that the case be sent to mediation. It would be at that time, which you can ask about a government loan modification or in-house loan modification, which would not require the large down payments but rather factor it in to the new loan, which could be paid over time.
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