Act 91 and Home Foreclosure: Basic Things to Know

Facing mortgage foreclosure is an overwhelming experience.   When you are struggling, it may seem like home foreclosure could appear out of nowhere, where one day you are in your house and the next you are out on the street.  However, in Pennsylvania, Act 91 lenders are required to provide you with a notice that a lender intends to institute proceedings against you.

When you receive this notice, it may seem that you have few options at your disposal.  But this does not mean that you are going to lose your home.  Take action, and contact The Law Firm of Fenters Ward today to explore your options.

For your benefit, we have outlined this procedure and the steps that you should take when you receive such a notice.

What is Act 91?

The Pennsylvania General Assembly signed Act 91 into law in 1983, which created The Homeowner’s Emergency Mortgage Assistance Program, or HEMAP.  As discussed in our PA County Programs blog, HEMAP is a loan program to aid in preventing foreclosure which requires the homeowner to eventually repay the loan in a suitable time frame.  Further information regarding the program itself can be found by visiting the blog.

Act 91 applies to a one, or two, family owner occupied residence, which is secured by a mortgage and is used as the principle residence of the mortgagor.  Under Act 91, lenders must provide homeowners facing foreclosure with notice of Act 91, which contains information about HEMAP.  An Act 91 notice does not mean that a lender has initiated a foreclosure proceeding and filed a complaint against you.  However, it is an indicator that a foreclosure action will soon be taken.

A lender may not foreclose on your home until you become 120 days delinquent.  30 days prior to your 120-day delinquency, a lender will send you an Act 91 notice which generally implies that in 30 days your lender intends to foreclose on your property.  Act 91 requires a lender to send you notice informing you of your rights related to HEMAP and gives your 30 days (plus 3 additional days for mailing) to consult and have a face-to-face meeting with a credit counseling agency (35 Pa. Stat. Ann. § 1680.403c). This is essentially a notice detailing the nature of the borrower’s default and further timing obligations to enact HEMAP assistance, cure default and prevent foreclosure.  An Act 91 notice can be viewed here.

As a homeowner, you never want to ignore the notice described above.  Just because you receive an Act 91 notice does not mean that you are going to lose your home, but it is the time to take action.  Remember, a lender must show that you were in default to win a suit and foreclose on your home.  Even after a complaint is served, there are forms of loss mitigation that can be sought and defenses that can be raised to keep you in your home.  If you are not eligible for HEMAP assistance, you may need to seek out such alternative measures such as a modification to prevent foreclosure.

We Can Help!

If you start falling behind on payments and start receiving notices from your lender, such as Act 91, you want to start thinking about what happens next.  Consulting with a lawyer who is knowledgeable about Act 91, and all other steps in the foreclosure process, should be your top priority if you are underwater on payments.

We at The Law Firm of Fenters Ward are more than willing to discuss and handle your foreclosure lawsuit. If you require legal assistance, please do not hesitate to reach out by either filling out this contact form or by calling us at 877-259-WARD.

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