A notice of default is a warning, not a sale. It tells you the loan is behind, how much it takes to catch up, and the date by which you must do it before the lender can move toward foreclosure. Most conventional mortgages require the lender to give you at least 30 days to cure the default before it can speed up the loan, and federal rules generally stop a lender from starting foreclosure until you are more than 120 days behind.
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Getting this letter does not mean your lender has decided to take the house. It is the step the paperwork requires before anything else can happen, and it is the best time to act, because every option is still open.
Different states and lenders use different names: notice of default, breach letter, demand letter, notice of intent to accelerate. They all say roughly the same thing: here is what you owe to catch up, and here is the date.
Most conventional home loans are written on the standard Fannie Mae and Freddie Mac security instrument (FHA and VA loans use their own forms), which requires the lender to give you notice and at least 30 days to cure before it can demand the whole balance. In a few states, mostly in the West, a "notice of default" is instead a document recorded with the county that formally starts a foreclosure outside the courts.
Under federal mortgage rules, a lender generally cannot make the first filing for foreclosure until the loan is more than 120 days delinquent (12 CFR 1024.41(f)). If you send the lender a complete application for help, a loan modification, a repayment plan, a forbearance, before that first filing, they generally have to review it before they can file. Those rules have exceptions, so ask your lender, in writing, what stage your loan is in.
Some states add their own required notice. In New Jersey, a lender must send a Notice of Intention to Foreclose at least 30 days, and no more than 180 days, before filing a foreclosure (N.J.S.A. 2A:50-56). In Pennsylvania, most homeowners must first receive an Act 91 notice, which gives you 33 days from the date on the notice to have a face-to-face meeting with a HEMAP-approved counseling agency and points you to the state's emergency mortgage assistance program (35 P.S. 1680.403c).
In most states, no. It is the warning the loan requires before the lender can demand the full balance. In a few non-judicial states, a recorded notice of default does formally begin the process.
The letter gives a cure date. Conventional mortgages require at least 30 days, and federal rules generally bar a first foreclosure filing until the loan is more than 120 days delinquent (12 CFR 1024.41(f)).
Usually, yes. If the price covers what you owe, the loan is paid off at closing and any money left after the loan, liens and closing costs is yours. If it doesn't, the lender has to approve the sale.
A HUD-approved housing counselor, at 1-800-569-4287.
No. Orrindale is free to homeowners and we are not a buyer. If we have local buyers working in your county we will introduce you, you choose who to talk to, and you are never under any obligation. If we do not, we will still point you to free help.
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This page is general information, not legal or tax advice. For your specific situation, consult a licensed attorney in your state or the relevant agency. Orrindale is a matching service, not a law firm, lender, or government program.