What is a Power of Sale and How to Stop It Immediately
A power of sale is a clause written into a mortgage contract that authorizes the lender to sell the property if the borrower defaults on mortgage payments. While New York is primarily a judicial foreclosure state, understanding how power of sale and foreclosure mechanics work is vital for protecting your home. If a lender begins taking action, you must understand your rights.
How Power of Sale Works
Under a power of sale clause, the bank does not need to file a full lawsuit to take ownership of the property. Instead, they send a notice of default and, after a waiting period, proceed directly to sell the property at a public auction. This process is much faster than judicial foreclosure, meaning you have less time to respond.
The Fastest Ways to Stop It
- Pay the Outstanding Balance: You have the legal right to redeem the mortgage by paying the arrears, late fees, and legal costs before the auction.
- Refinance with a Private Lender: Securing a new mortgage to pay off the existing lender.
- Sell to a Cash Buyer: Selling the house directly to an investor who can close quickly using cash.
Peak Cash Buyers has the liquid funds ready to buy properties facing default, allowing you to settle the debt in days. See how to stop bank sales in WNY.