Foreclosure law is different in every state, and you cannot rely on the media to give you information relevant to Missouri. Our state has what is referred to as “statutory foreclosure,” which means that the foreclosure does not occur through the court system and follows the requirements set out by the Missouri statutes. For practical purposes, this means that the foreclosure happens quickly without the intervention of the courts.
Because of the current real estate market, there is a growing trend among sellers of residential homes to self-finance the buyer of their property, becoming a lender as to that one transaction. If the buyer stops making payments, these former sellers turned lenders may need to foreclose in order to get the property back.
The positive side of foreclosing on real estate located in Missouri is that it is a relatively quick process. There are strict time-frames and procedures to follow, so the use of an attorney is advised. In comparison to other states, it is a much cheaper and easier process in Missouri to conduct a foreclosure sale since the court is not involved. The procedure starts with sending letters asserting that there is a default, accelerating the loan, and complying with the requirements of the Fair Debt Collection Practices Act regarding notices to the debtor concerning disputing the debt. The sale date for the foreclosure will be scheduled and notices of the sale required by statute will be sent to certain parties as required by law. Ultimately, the foreclosure sale will be published in a local legal newspaper and then the foreclosure sale will be held.
In states where the courts are involved, a homeowner has an easier chance to seek court review when a foreclosure is wrongful. In Missouri, to get a court involved, the homeowner has to file a lawsuit. If the homeowner does not move for court intervention PRIOR to the foreclosure sale, they can risk permanently losing rights to the property itself even if later they are successful in their claims against the lender. It is very important that homeowners seek legal advice weeks before the foreclosure sale. This will give them the time necessary to file a lawsuit against their lender if they have any valid legal reason to stop the foreclosure sale.