A growing trend within the mortgage industry is to have a goal of having your maximum monthly mortgage payment (including principal, interest, real estate taxes, and homeowner’s insurance) be at most 31% of your Gross Income.

A letter from your lender, sent after you have stopped paying, stating that the whole amount of your mortgage is due immediately.

A written response to the Complaint, in which a homeowner lists all of their defenses to the foreclosure, as well as raises any counterclaims they may have against the Bank.

A written notice that removes the previously filed Lis Pendens from the county clerk’s records, which removes questions regarding the status of title to the property.

Capitalization occurs when items owed on a loan (past due interest, taxes, late charges, legal costs or other fees) are added to the unpaid principal balance of the loan and are treated as part of a new principal balance.

A written document that is filed with the Court and tells you and the Court the reasons the Bank is suing you and what they are asking the Court to do. Because this is a foreclosure, the Bank is claiming you have not made your monthly payments as required by your Mortgage and Note.

A process where the borrower gives the deed to the property back to the lender, and the lender discontinues any foreclosure action.

Failing to meet the requirements of an agreement. Most defaults involve failing to make required mortgage payments on time.

The amount a borrower owes to the lender after the sale of the property at a foreclosure sale in the event the property is sold for less than the amount of the debt owed.

A tool used in lawsuits to obtain information and documents from other parties.

A plan to cure a default that may involve a temporary suspension or reduction of payments.

The amount charged by a lender for the right to borrow money, as expressed as a percentage of the principal amount borrowed.

The final part of a court case. A valid judgment resolves all the contested issues and terminates the lawsuit, since it is regarded as the court’s official pronouncement of the law on the action that was pending before it. It states who wins the case and what remedies the winner is awarded.

A written notice that a lawsuit has been filed concerning real estate, involving either the title to the property or a claimed ownership interest in it. The notice is usually filed in the county clerk’s offi ce. Recording a Lis Pendens alerts a potential purchaser or lender that the property’s title is in question, which makes the property less attractive to a buyer or lender.

An agreement to permanently change one or more terms of the original mortgage (i.e.: interest rate, payment amount, term etc.)

The process in which the Bank will work with homeowners in an eff ort to avoid foreclosure. This term often refers to the group within the Bank that you will be working with throughout the foreclosure process.

A written document that secures property as collateral for a loan. This is the document that allows the bank to foreclose, because you have agreed that if you default on the Note (i.e.: stop payments) they can sell your property to collect on the debt.

A written document that is a promise to pay. Typically, when you borrow a large sum of money from a lender, you pay it back with interest, in monthly installments, over a period of years. All these loan terms are found in the loan’s note.

Formal notification by a party to a court (and to parties already involved in a case) that it wishes to participate in the litigation process.

A document presented by the Bank to the Court, which allows the foreclosure proceeding to continue in the Court system if a Settlement Conference has been unsuccessful. An Order of Reference would appoint a Referee to determine how much you owe the Bank.

A reduction in the total amount owed on the loan.

Appearing in a court proceeding for oneself - without an attorney representing them.

A person authorized by law to deliver papers, typically the Summons and Complaint, to the Defendant.

The process of paying off a loan by borrowing new money, either from the existing lender or a new lender.

A plan where the borrower pays their regular monthly mortgage payment PLUS an additional amount to pay off the amount they are behind on their mortgage.

The delivery of a summons, complaint, or other legal document to a person.

The sale of a home for less than what is owed on the mortgage. Short sales must be approved by the lender, since the Bank will take a loss on what is owed to them.

A document filed by the Bank with the Court to signify that an agreement has been reached and that the foreclosure proceeding will be terminated.

A motion in a court proceeding to end the case without a trial on all the facts. This is typically done in the foreclosure context before any Discovery has occurred.

A legal document that notifi es a party that a legal proceeding has been started.