What is "Foreclosure"?

Question

I'm only a kid but I feel the need to understand such issues as the crude oil issue, the economy, the stock market, etc. etc.

I tried to look this up but like I said, I'm only a kid so all that mumbo jumbo was like a foreign language to me.

Can someone please explain in basic (but detailed) terms what "foreclosure" is and why it is so bad?

Answer 1

i am a grown up with no definite answer to ur question but here's what i think a foreclosure is

we buy houses .lets a 300,000 house.we put maybe 50,ooo down..at first, the remaining 250,000 has to be paid in monthly installments

there are different ways of paying that balance..we can make it a fixed monthly payment at whatever the interest rate is when we bought the house..say the interest was 6% .we fix it at that rate..then our monthly payments would be 1500(a fictional figure) a month till we pay the 250,000 off.

we also have a choice of how long we can opt to pay it off..the usual choices are 15 years or 30 years.

this is all i know...i think foreclosure affects people who opt for variable rates of interest /or buy houses way beyond their means when the going was good...im sorry i have to stop..hope another answerer will clear this up for both of us.

Answer 2

Foreclosure is the legal proceeding in which a mortgagee, or other lienholder, usually a lender, obtains a court ordered termination of a mortgagor's equitable right of redemption. Usually a lender obtains a security interest from a borrower who mortgages or pledges an asset like a house to secure the loan. If the borrower defaults and the lender tries to repossess the property, courts of equity can grant the owner the right of redemption if the borrower repays the debt.  

Answer 3

YOu own a house.  You don't pay the monthly payment.  You get a friendly letter from the bank reminding you to pay the money.  You don't pay.  Apx 90 days after you missed the first payment, you get an official letter:  If you don't pay, the house will go back to the bank that loaned you the money to buy it.  If you pay on day 89, you stay there.  On day 90, the sheriff escorts you out of the house.  You are not the owner. The bank owns it.  The house has been foreclosed./

Answer 4

Home foreclosure is a process by which a lender regains a property which they have financed. Typically, this is because the borrower or homeowner is behind on house payments and is unable to catch up, often due to circumstances outside of his or her control. When the lender forecloses on the homeowner, the homeowner must move out of the house, therefore, losing all possession of the property and jeopardizing any possible equity that the homeowner may have in the home. There is a legal time frame, which varies from state to state, which determines how long the foreclosure process can take.