The short answer is, it depends on the type of loan that you have.
Is your loan a conventional (fannie mae Freddie mac) or a government insured/guaranteed loan (FHA and VA)? This is also different for residential versus commercial, so I am sticking to residential in my explanation.
It also depends on the state collection practices laws, could fall under the fair credit reporting act (FCRA) and other laws about collecting debts, so please know that this is general basic info.
For the “start” of foreclosure – not the foreclosure process – I will stick to that and not explain the whole foreclosure process as that varies from state to state (Mortgage vs Deed or judicial vs non-judicial states).
Please note that other things besides SLOW PAY or NO PAY can trigger a foreclosure and may have separate time frames.
Timelines: The lender through the promissory note, or mortgage, that you sign when you get your loan says that you are late if you pay past the 1st of the month. You are charged a late fee if paid after the 15th of the month. If you are more than 30 days late on the mortgage payment you are in default and they can commence foreclosure. The servicers have to notify you in writing and phone call at every known address and phone number and attempt to collect the late payment and notify you that you are late, but if they were super aggressive ,as they are in the private or hard money lending business, they might start on the first day of the next month.
Luckily few servicers and investors want to be that aggressive. So they may wait 60 or 90 days.
If it is an FHA or VA loan they must show that they attempted to work with you and therefore will not start foreclosure on the 1st day of the next month.
There are ways to forestall the conventional and government lenders from starting a foreclosure which you can see on Fannie Mae and FHA and VA websites.
I hope this helps!
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