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To report a problem with your lender, TRUST DEED FORECLOSURE MANDATORY MEDIATION mortgage broker, or escrow agency contact: N E VA D A L E G A L TIMELINE Beginning July 1, 2009, your lender must in- SERVICES Record Notice of As soon as 1 day after clude with your notice of default a notice advis- ing you of your right to request mediation. You Mortgage Lending Division Default and Notice of default will also receive two envelopes and you must Mediation either elect or waive (give up) mediation within The Division is authorized to enforce the Mail Notice of Default Same day as Notice of 30 days by sending notice to the mediator and statues and regulations pertaining to and Notice of Mediation Default recorded your lender. You must also deposit $200. Mortgage Bankers, Mortgage Brokers, Mortgage Agents, Escrow Agencies and FORECLOSURE Mediation Request Within 30 days of No- Mediation is mandatory and you and your tice of Mediation lender will sit down with a mediator to discuss Escrow Agents. If you feel a mortgage ways to avoid or lessen the hardship of foreclo- company has given you false informa- Mandatory Mediation Within 80 days of re- sure. The mediation requires good faith on the quest of homeowner part of both you and your lender. This means tion you may contact: you cannot request mediation to simply delay Danger Notice No later than 60 days the foreclosure sale. You should have (1) a Las Vegas Office before sale date steady income or the prospects of a steady 7220 Bermuda, Suite A income in the near future; or (2) you are willing Notice of Sale 3 months after re- to give up your home (short sale) and want Las Vegas, NV 89119 cording Notice of De- more time and/or money to move (cash for fault or after conclusion 702-486-0785/mld.nv.gov of mediation, if later keys). Good faith also requires your lender to than 3 months accept a reasonable offer. Both you and your lender must also prepare and bring to the me- Time to Cure (pay off No later than 5 days If you have an FHA mortgage or want debt) before sale date diation certain documents. information on a HUD approved coun- For more information, visit the Supreme Court’s seling agency contact: Sale by Auction At least 21 days after website at www.nevadajudiciary.us or call the Notice of Sale recorded Mediation Program Administrator at (702) 486- HUD Counseling Agency 9380. (800) 569-4287 Do not have unreasonable expectations. Me- TDD (800) 877-8339 TRUST DEED FORECLOSURE diation can result in lenders reducing your monthly payment and giving you more time to Trust deed foreclosures comprise the majority catch up. No lender will wait indefinitely for of foreclosures in Nevada. A trust deed fore- closure is NON-JUDICIAL, meaning your payment and you must have a plan to get bank, lender, or mortgage servicer does not caught up or move out. need to go to court to foreclose and sell your Contact a HUD-approved housing coun- home. If you have missed a mortgage pay- selor: HUD funds free or very low cost housing ment, the lender or servicer begins the fore- 530 South Sixth Street closure process by mailing and recording a counseling nationwide. Nevada Legal Services Las Vegas, NV 89101 notice of default and election to sell. This is is a HUD-approved housing counseling agency notice to you that the legal foreclosure proc- and can help with your foreclosure issue. Do (702) 386-0404 ess has begun and you will have about 4 not wait for the notice of sale or eviction notice. Toll Free (866) 432-0404 months to cure the arrearage or work some- If you think you cannot pay your mortgage, PLEASE NOTE: Laws are subject to change. thing out with your lender to save your home contact your lender. If you have received a Information contained in this pamphlet is based from a foreclosure sale. notice of default or any other foreclosure no- on the laws in effect at date of publication. tice, you may contact Nevada Legal Services 7/1/09 www.nlslaw.net at (702) 386-0404. HUD Loss Mitigation Program 4. Offer a deed-in-lieu of foreclosure: You Military Personnel and Spouses Making Home Affordable Program and your lender agree that you will deed Federal Housing Administration (FHA) Loans you home back to the lender and move The Service Members Civil Relief Act of 2003 In addition to the loss mitigation options of- have other options for preventing foreclosure out. You will lose the equity (if any), but the (formerly the Soldiers’ and Sailors’ Civil Re- fered by HUD for FHA insured loans, home- and you should contact a Department of lender may cancel the debt you how. Note: lief Act of 1940) provides additional benefits owners may also qualify for refinancing or Housing and Urban Development (HUD) The cancelled debt may have adverse to service members on active duty. loan modification through the Making Home housing counselor the moment you think you income tax consequences, as offering a Affordable Program. will be late on your mortgage. deed-in-lieu of foreclosure or selling your A court order is required before a home is home for less than the amount of the debt sold at a foreclosure sale while a service Refinance option: The refinance option is HUD’s programs depend on whether you have may be reflected as income. member is on activity duty or within 90 days only available to homeowners with Fannie been delinquent for less than 90 days or for after the end of active duty. This law applies Mae or Freddie Mac owned loans. You can 90 days or more (Loss Mitigation). With any 5. Pre-foreclosure or short sale: If you can even in non-judicial foreclosure states like see if your loan is owned by Fannie Mae or FHA foreclosure, the earlier you contact HUD, no longer afford to make payments on your Nevada. Therefore, a lender cannot foreclo- Freddie Mac by visiting their websites at: the more options you will have. Even if you mortgage, you may consider speaking with sure on a home through the trust deed fore- www.fanniemae.com/loanlookup or do not have an FHA insured loan, you may a real estate agent about selling your closure process. Instead, the foreclosing www.freddiemac.com /mymortgage. still discuss the options outlined below with home. Ask your lender to agree in writing party must file a foreclosure action in court. your lender. Your lender must also provide that you can have a certain time to sell Homeowners must be current to qualify. This you with a copy of the HUD publication PA your home before foreclosure can occur. If the home is sold at a foreclosure sale with- means you cannot be more than 30 days late 426-H, May 19, 1194, How to Avoid Foreclo- Your lender may also agree to accept less out a court order, the sale may be rendered with your mortgage payment in the last 12 sure. than the amount of the current mortgage invalid and could subject the lender to crimi- months. The amount due on the first mort- balance and you may be able to sell your nal prosecution. gage must be less than 125% of the home’s Some options include: house for less than market value in order value (and second mortgages do not neces- to sell your home quickly. This will avoid a The court can also stay foreclosure proceed- sarily make you ineligible). 1. Special Forbearance: You may be able ings while the service member is on activity foreclosure affecting your credit. Note: to work out a written repayment agree- Nevada has a high number of homes for duty. The military service must materially You will not be able to reduce the amount of ment with your lender to reinstate your sale in a declining market. affect the service member’s ability to pay, the principal balance on the mortgage and loan. The written repayment agreement though, in order to obtain the stay of the fore- will not be able to get more than $2,000 to must have a term of at least 4 months and Avoid scams and foreclosure prevention closure proceedings. A foreclosure obtained pay off other debts. may include a suspension or reduction in companies: You do not need to pay fees for by default during active duty or within 60 payments for a few months to help the foreclosure prevention, use that money on your days after the end of active duty may be re- Modification option: This option applies to mortgage instead. If any business claims they opened or set aside by the court. Fannie Mae and Freddie Mac owned loans borrower recover from the cause of de- can stop your foreclosure immediately if you and to any servicer choosing to participate in fault. Active duty service members can also re- the program. You can go to makinghomeaf- sign documents, be very careful and read the 2. Loan Modification: The lender or loan documents you are signing. Often foreclosure quest a reduction in the interest rate on any fordable.gov to see if your servicer has scammers have you sign blank papers, docu- debt incurred prior to active duty. The inter- elected to participate in the program. servicer may also be able to modify your ments that appoint the scammer to act on your est rate must be reduced to 6% while the mortgage to cure the default and make The loan must have been originated before behalf, or even a deed of your property to the service member is on active duty. The ser- the loan more affordable for the borrower. vice member must request the interest rate January 1, 2009, and must have an unpaid scammer. Many scammers ask you to sign A loan modification permanently changes reduction from the lender and provide proof principal balance of less than $729,750. Sec- immediately without consulting anyone else. one or more terms of the loan and can You may then end up as a renter in your own of the return to active duty in order to qualify. ond mortgages, again, do not necessarily include changes in the interest rate, capi- home. If the ability to pay on the debt, though, is not make you ineligible for the program. talization of any delinquent amounts, and materially affected by the military service, a extension of the term of the loan. ACT NOW: Waiting for a letter regarding the court can decide to raise the interest rate Your mortgage payment must be more than sale date is not recommended. As soon as above 6%. 31% of your household’s gross income. You 3. Delinquent Refinance: Remember you you miss a payment or believe you cannot do not have to be in default in order to qualify must have equity in the home to be able make a payment contact your lender or contact but must generally be in imminent risk of de- to refinance. This option also depends on a HUD housing counselor. Nevada Legal Ser- fault. Your servicer can reduce your interest the borrower’s ability to continue making vices is a HUD-approved housing counseling rate, extend payment terms 40 years, or fore- agency. Call us toll free at (866) 432-0404. bear principal in order to make the loan af- payments. fordable for you.
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