Foreclosure Laws in Rhode Island

In Rhode Island, both in court (judicial) and out of court (non-judicial) foreclosures are used.
As with all states, where both types of foreclosures are pursued, the vast majorities of foreclosures are performed with the out of court process. This is because it saves the bank both time and money.

As to which method of foreclosure the bank will choose to use, is whether or not the mortgage or deed of trust contains a power of sale clause. The power of sale clause is what gives the bank the right to do an out of court foreclosure. Most documents, these days, include a power of sale clause, but in those instances where the mortgage or deed of trust does not contain a power of sale clause, then judicial or in-court foreclosure is required.

To pursue in court foreclosure the bank must file a law suit to get a court order to foreclose after such a court order is obtained, the bank will proceed to the public auction of the home. The actual process of selling the home to get the money owed to the bank is the same in both judicial and non-judicial processes. Out of court foreclosure just saves the bank the extra expense and time of filing the original law suit with the court.

Sometimes, but not very often, a power of sale clause will state specifically when and where and by what terms a sale of the property is to take place. In almost all cases, those specifics are not laid out in the mortgage or deed of trust.

The regular process of moving toward an auction of the home is as follows:

At least twenty one days prior to the scheduled sale, the bank must advertise the sale in the local paper, that has circulation in the county in which the home is located. This ad must be run a minimum of once a week for each of the three weeks leading up to the scheduled sale date.
Twenty days before the scheduled sale date, the bank must send the home owner a written notice of the upcoming sale. This must be sent by certified mail. It must also include both the time, and place of the sale. This letter must be sent return receipt requested. It must be sent to the homeowner at their last known address.

There are some situations in which a person who looses their home at the public auction is allowed to but it back at the highest bid price, including additional costs, fees and interest, but this option varies from situation to situation.

In Rhode Island, deficiency judgments are allowed. This means that if the bank is not satisfied with the price the home sold for at auction, and they feel there is some chance they can obtain additional money by reissuing the former home owner for those funds, then they are allowed to sue the people for those funds.

Of course, most banks realize that when a borrower has “lost” their home to foreclosure, they don’t have any other assets worth pursuing. This being the case, deficiency judgments are very rarely sought.

Foreclosure Laws – Get Proper Legal Advise If You Are Facing Foreclosure

Foreclosure laws can be very perplexing; foreclosures laws vary from state to state. Sometimes general information may be all that you need to start in the right direction. Make sure that you investigate the laws pertaining to you state or contact a real estate agent or attorney to ensure that you fully understand what you are up against and the amount of time you have to get help.

Foreclosures happen when a borrower defaults on the loan. By filing a “notice of default”, on the property with the local court system where the property is located. Once the courts make a ruling in favor of the lender the property, generally put up for sale at a public auction. However the is a timeline between the filing of the legal paperwork from the lender and the auction sale of the property, this is where the local laws vary. Depending on the state and circumstances, this timeline is from three to twelve months long.

Lenders or the courts will publish an auction ad approximately thirty days prior to the auction. However, before publishing the ad the homeowner is served with a notice about the foreclosure and pending auction sale. As soon as the property sells, the title/deed is given the new owner of the property.

If are facing financial hardship, in default on your mortgage payments you still may have a chance to avoid foreclosure, your chances are better if you have not yet receive a notice of foreclosure. Make sure that you do not ignore the phone calls or letters sent by the mortgage company, talk to them, they are not that bad to deal with. Well, maybe they are but ignoring them will not help your situation with them. Generally, they would rather try to work something out then to pursue the process and expense of a foreclosure.

Hiring someone that fully understands and can advise you on the local foreclosure law may be a wise decision on your behalf. They can be the mediator between you and the lender, and protect your rights as a homeowner; many times, they can assist in preventing a foreclosure as well.

Many sites available offer general information regarding foreclosure law, while most provide general information, make sure that you get proper legal advice from an attorney. Remember banks really would rather not foreclosure on your property, however if given no other option the will. The best approach is to educate yourself, ask question, do some research and most importantly do not just roll over and give up, fight for your home.

Understanding the Concept of Foreclosure Laws

Although the processes of foreclosure laws vary in different states, overall the same principles are attached. These laws depend on whether deeds of trust or mortgages are used for property purchase. States utilizing the mortgage method have judicial foreclosures and those using deeds of trust have non-judicial foreclosures. The main difference is that judicial procedures require court action on the foreclosure.

In a judicial procedure, a lender has to prove the homeowner defaulted. After the lender fails in attempts to retrieve payments an attorney is consulted in order to further the issue with court action. The attorney then tries to contacts the homeowner to resolve payment defaults. If the homeowner cannot comply a lawsuit is filed. A notice is published to the effect of a pending foreclosure action.

Foreclosures that are non-judicial contain a clause of power of sale. This clause enables institution of a foreclosure sale with no need for a court case. The trustee issues a default and notifies the homeowner about the status of default. If there is no response a foreclosure sale is set to initiates.

It is crucial to understand the laws before taking steps to buy a property that has reached foreclosure. It is necessary to be aware of sources of information on the property and the length of time that residing tenants have to exit the property.

Foreclosure laws state that a listing of these properties in local newspaper adverts is necessary. Foreclosures can be located within any state. Banks also list foreclosure that is on sale. Any public member can attend auctions and place bids on available properties.

There will be a requirement of a down payment to serve as bank protection and evidence of affordability. It is crucial to have a clear understanding of foreclosure laws before buying property in the foreclosure range.

Foreclosure Law Professionals Are Beneficial

Losing a home can be one of the most devastating things that anyone can go through. That’s because a home is something many people dream of having and work extremely hard to attain and maintain. Therefore, to lose something so special can be heartbreaking. It is also sad to lose a home because of the many memories that are made in it. For many people, it’s not the size of their house that they love or enjoy the most, but it is the memories that are connected to it. This can also be a fearful time, as some people may not have any place to go. These are just a few of the reasons why foreclosures can be so demoralizing. One of the only ways that a homeowner can try to keep their home is to solicit the help of a foreclosure law professional.

One of the main reasons that foreclosure law professionals are so essential is because they can properly navigate the oftentimes-complicated field of law. The legal system can be extremely confusing and intimidating to people who aren’t familiar with it. That is one reason that lawyers must go through so much schooling and training. It takes a lot of knowledge and experience to be successful in this particular industry. So, if most homeowners were to try and handle their own case, there’s a good chance they would end up easily losing the fight.

A skilled professional on the other hand, can present the homeowner with several different options that they may have not been aware of. They can also present the case in such a way that their client would have a better chance of keeping their home.

Having a foreclosure law professional to handle a case, also allows homeowners to be less stressed. Going through this type of situation can be overwhelmingly stressful to anyone. Having to deal directly with a legal case, on top of that is not a good idea. So, by having someone who can come in and handle the case, it helps to reduce the amount of stress on the homeowner’s shoulders.

So, a foreclosure law professional is the best person to go to when someone is in the midst of possibly losing his or her home. Going at it alone can mean extra stress and a surefire way to an unsuccessful outcome.

Some may say that foreclosures aren’t really a big deal because if someone loses their home, they can always get a new one. However, many times people create unforgettable memories that can seemingly be ripped away when someone comes along and takes their home. Sometimes, it’s not the object that is important, but it’s what that object or thing represents.

New Jersey Foreclosure Law Facts

1. The Defendant (borrower or property owner) misses several mortgage payments – usually 2-4 payments.

2. The Plaintiff (Lender, Bank, or Creditor) files Notice of Default or Lis Pendens with the Supreme Court in Trenton, NJ and that information is passed to the county offices.

3. New Jersey is a Judicial Foreclosure State which means the court approves the sale and the Plaintiff gives notice to the defendant. If the response is inadequate and the required loan payment and fees are not paid, the Plaintiff goes to court for Auction Sale Approval. This is commonly known as a Sheriff’s Sale or Sheriff’s Auction sale.

4. Once the sale is scheduled, it must be publicly advertised in two county newspapers for four consecutive weeks, and it must also be posted on the property.

5. The Plaintiff must notify the Defendant at least 10 days prior to the sale. In most cases, Defendants are allowed two adjournments to try to rectify the pending foreclosure.

6. At the Sheriff’s Sale, the property is sold to the highest live bidder, and a 20% deposit is by cash, certified or bank check. The balance is due in 30 days.

7. After the Sheriff’s Sale, the Defendant has 10 days to redeem the property. If the property is not redeemed (right of redemption), the Winning Bidder owns the property. If the property is not vacant, the new owner may have to obtain a Writ of Possession to have the occupants evicted.

8. If the Foreclosure Auction does not pay the loan and fees in full, The Plaintiff can file a deficiency judgment for the remainder of the loan.