I have a non-performing loan (NPL) account with my bank. It has been an NPL for approximately nine years. The bank is now auctioning my property to recover their loan and if the reserve price is realized, then the bank will recover their loan amount plus nine years of interest.
Am I correct in assuming that the bank has been charging only interest these nine years? Is there a period where the interest is stopped and I focus on repaying the capital amount borrowed plus interest factor until it reached NPL status?
Generally your contract allowed for post maturity interest. Unless state law required it to stop at some time interval, it would have accrued from the date your loan was accelerated and called due in full.
There will also be attorney's fees, selling costs and perhaps even taxes. It is not common for a property to sell for an amount that covers both the loan and the associated expenses. You could easily still owe them money on the loan after the sale.
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Generally your contract allowed for post maturity interest. Unless state law required it to stop at some time interval, it would have accrued from the date your loan was accelerated and called due in full. 