120-Day Foreclosure Rule — Buy Time With a Loss Mitigation Application Before the Servicer Accelerates
What Is It?
Federal mortgage-servicing rules generally prevent a servicer from making the first notice or filing for foreclosure until the loan is more than 120 days delinquent, subject to the rule’s exceptions. That window can give borrowers time to submit a loss mitigation application.
What Most People Don’t Know
- The 120-day period is not debt forgiveness, but it is real timing protection.
- A complete loss mitigation application can create additional procedural protections.
- Servicer timing and document-handling mistakes can matter.
Frequently Asked Questions
Can the servicer start foreclosure as soon as I miss a payment?
A: Not generally. Federal servicing rules usually bar the first foreclosure notice or filing until the mortgage is more than 120 days delinquent.
Why does a complete loss mitigation application matter?
A: Because the timing and review duties become more protective once a complete application is in the system.