The challenge of understanding the foreclosure process often only adds to the stress of the situation as a whole. Many New Jersey residents currently facing foreclosure feel overwhelmed not only by the process, but by the task of searching for a new living space. Below, families can get a better picture of foreclosure regulations and what to expect during such a difficult life chapter.

Although each state provides its own information regarding foreclosure laws, it can sometimes help to look to a condensed outline. Zillow’s Foreclosure Center provides just that, sharing the basic steps of the foreclosure process. When a homeowner does not pay the mortgage — whether because of unemployment, medical bills or other exorbitant financial pressure — a foreclosure auction could be around the corner. A lender usually submits a public notice to with the county’s recorder’s office after three to six months of missed mortgage payments. From there, Zillow notes that a borrower may then enter a stage of pre-foreclosure. If the issue continues, the lender may arrange an auction. 

Each situation may differ, but countless homeowners grapple with one common aspect: a second mortgage. Credit Card Insider explains what happens to a second mortgage after foreclosure, first stating that it is usually a wise step for homeowners to discuss debt concerns with a real estate attorney prior to the process. A bank holding the second mortgage would have the right to any leftover equity received from the foreclosure; despite this fact, Credit Card Insider points out that most homes do not sell for enough to pay off both mortgages. After giving a rundown of the steps involved in managing mortgages, the financial resource goes on to stress that, depending on the state, banks holding the second mortgage could sue the homeowner in efforts to obtain a deficiency balance. However, homeowners should keep in mind that all foreclosure situations, while stressful for most, can be unique and can require different strategies.