Foreclosure Law

Even if you have suspected that your home would go into foreclosure, perhaps you were misinformed and believed you had to wait until you received a notice of default from your lender before you could do anything. Maybe even now that you have received the notice, you are still stunned and paralyzed with the fear of losing your home.

No matter what your situation may be at the moment, if you have just received a notice of default and are facing a foreclosure, now is an excellent time to get started on understanding the foreclosure laws that apply to your particular situation and to begin seeking help from professionals who can help to end foreclosure proceedings against your home and restore your home loan to a proper state of payment. Most importantly, you can achieve a peace of mind and return to sleeping at nights knowing that your home is not in jeopardy of being taken from you.

It cannot be overstated that foreclosure law is different from state to state. For example time frames for each state are as follows:

Alabama: 49-74, Alaska: 105, Arizona: 90+, Arkansas: 70, California: 117, Colorado: 145, Connecticut: 62, Delaware: 170-210, District of Columbia: 47, Florida: 135, Georgia: 37, Hawaii: 220, Idaho: 150, Illinois: 300, Indiana: 261, Iowa: 160, Kansas: 130, Kentucky: 147, Louisiana: 180, Maine: 240, Maryland: 46, Massachusetts: 75, Michigan: 60, Minnesota: 90-100, Mississippi: 90, Missouri: 60, Montana: 150, Nebraska: 142, Nevada: 116, New Hampshire: 59, new Jersey: 270, New Mexico: 180, New York: 445, North Carolina: 110, North Dakota: 150, Ohio: 217, Oklahoma: 186, Oregon: 150, Pennsylvania: 270, Rhode Island: 62, South Carolina: 150, South Dakota: 150, Tennessee: 40-45, Texas: 27, Utah: 142, Vermont: 95, Virginia: 45, Washington: 135, West Virginia: 60-90, Wisconsin: 290 and Wyoming: 60.

Just as each state has a different time frame, the laws that govern the particular state are different from the next state as well. There is no way to list all of the different laws that are applicable in their respective states. Even if it were possible to list all of the laws here, it would be impossible to keep the listing current as laws can change from state to state and year to year, depending on the state’s government and legislation.

Both judicial and non judicial forms of foreclosure regulations are used from state to state. Likewise, the sale publication and redemption period can vary, including some states where the court decides what the redemption period will be. There are many different web sites that offer some general information about foreclosure law for each state. These sites should not substitute for learning about the foreclosure law in the state applicable where the property is that you are concerned with.

Although foreclosure is a lender option to allow the lender to gain back the property or cash for the property, foreclosure law is designed to help the homeowner take advantage of the opportunities that exist with foreclosure time frames and various other laws within each state that work to help the homeowner stop foreclosure before losing their home. 

Summary Of Vermont State Foreclosure Law

There are four different type of foreclosure are followed in Vermont.

Strict foreclosure

Power of sale foreclosure

Judicial foreclosure

Non-Judicial foreclosure

What is the processing period for foreclosure in Vermont?

Processing period is normally 210 days (Approximately 7 months) in Vermont.

Is there any right of redemption in Vermont for foreclosure?

Yes, Vermont offers a right of redemption.

Are deficiency judgments permitted in Vermont?

Deficiency judgments are permitted in Vermont.

Which law provision governs foreclosure in Vermont?

They are found in Vermont Statutes, Title 12 (Court Procedure), Part 9 (Particular Proceedings), Chapter 163 (Chancery Proceedings), Subchapter 6 (Foreclosure of Mortgages)

What happens during Strict Foreclosure in Vermont?

In this type of foreclosure, the lender owns full right of the property, till the loan is paid fully. If the borrower breaks any condition, he or she loses all the right in the said property and lender can put up the property for sale. But before taking such action, a suit must be filed in the county office where property is located. The borrower is instructed to appear in court and informed of his rights, at which time the lender may move for a summary judgment and avoid the trial altogether. In this type of foreclosure, the borrower gets a redemption period either of six months (post-1968 mortgages) or 12 months (pre-1968 mortgages).

What happens during Power of sale foreclosure in Vermont?

In this type of foreclosure, foreclosure is conducted only when power of sale clause exists in deed of trust/mortgage. This clause allows borrower pre-authorizes the sale of property to pay off the balance loan in the incidence of their default. In such cases power is given to lender to sell the property by himself or his representative who generally referred as trustee. This foreclosure can be done judicially or non-judicially, depending on the type of property in deed of trust/mortgage.

What happens during Judicial Foreclosure in Vermont?

In this, the lender needs to file complaint against the borrower and obtain decree of sale from the county court where property is located. Generally this type of foreclosure takes place when the property includes a dwelling of two units or less and the owner is using property as main residence. The sale of such property can not be held until the 7 months after the decree of sale has been issued.

What happens during Non-Judicial Foreclosure in Vermont?

Non-judicial foreclosure is conducted only when power of sale is contained in mortgage related to property excluding for a dwelling house of two units or less and it is occupied by the owner as main residence. The lender may use the power of sale without first commencing a foreclosure action or obtaining a foreclosure decree.

Guidelines for power of sale

The lender must send notice with intention for foreclosure to the borrower at least 30 days before the publication of sale notice and it should be sent by certified mail. The notice should have information on property to be foreclosed, state the condition breached and lenders right to accelerate the mortgage and include the total amount necessary to prevent the foreclosure.

The borrower may receive the sale of notice 60 days before the schedule date of the sale. The sale should occur at property itself and any surplus money should be given to the borrower.
However if the property is sold without intervention of court, the notice must include the following language.

“The mortgagor is hereby notified that at any time before the foreclosure sale, the mortgagor has a right to petition the superior court for the county in which the mortgaged premises are situated, with service upon the mortgagee, and upon such bond as the court may require, to enjoin the scheduled foreclosure sale. Failure to institute such petition and complete service upon the foreclosing party, or their agent, conducting the sale prior to sale shall thereafter bar any action or right of action of the mortgagor based on the validity of the foreclosure, the right of the mortgage holder to conduct the foreclosure sale, or compliance by the mortgage holder with the notice requirements and other conditions of section 4532 of Title 12. An action to recover damages resulting from the sale of the premises on the date of the sale may be commenced at any time within one year following the date of the sale, but not thereafter.”

This is legal information; it should not be treated as legal advice.

Understanding Oregon’s Mortgage Assistance and Foreclosure Laws

Oregon has experienced a frightening foreclosure rate increase during the first quarter of 2010. Approximately 22 thousand homeowners in the state are delinquent in their mortgages as of January this year and there are thousands of others who have already lost their homes due to bank repossession. Currently, the U.S. Department of Treasury has placed Oregon in one of the top 20 states with the highest foreclosure rates in the country and has allocated a budget of around 86 million dollars to finance the different mortgage assistance and foreclosure prevention programs of the government which are implemented by the Oregon Housing and Community Services.

In order to avoid discrimination and prevent fraudulent activities in the Real Estate industry, the Oregon Housing and Community Services has come up with a new foreclosure law which will serve as a guide in giving mortgage assistance to Oregon homeowners. The following are the various laws regarding foreclosure and loan modification practices that must be upheld at all times by all sectors in the Oregon housing market.

  1. Affidavits for Loan Modification (HB 3610) – The new bill requires mortgage lender to file the affidavit requirement five days before the foreclosure sale takes place. Furthermore, it mandates servicers and lenders to provide accurate and complete information to their borrowers regarding their loan modification application especially when the lenders or servicers decide to reject the homeowner’s request.
  2. Foreclosure Prevention (SB 628) – It gives every Oregonian homeowner the right to a meeting with his or her mortgage lender either via telephone or face-to-face.
  3. Tenants in foreclosure (SB 952 and HB 3004) – These bills require landlords to give advance notice to their tenants about the imminent foreclosure of the property. It aims to provide protection to renting individuals or families, and providing assistance in finding low cost rental housing for them.
  4. Mortgage lending practices (HB 2188) – Provides protection to Oregonian homeowners against abusive and discriminating practices of mortgage lenders. It requires lenders to provide translation when transacting with individuals who speak in languages other than English.
  5. Enforcement of new federal mortgage lending standards(HB 2189) – Allows the Oregon Housing and Community Services to make laws that deals with the housing market to ensure that borrowers’ rights are protected. The bill also ensures that all personnel working in the loan modification companies in the state has adequate education, experience, etc.
  6. Mortgage and foreclosure notification (HB 3630) – Safeguards homeowners against fraudulent “consultants” and “equity purchasers” and gives borrowers the right to cancel contracts with these “loan modification experts” as the homeowner deemed necessary.
  7. Debt management services (HB 2191) – Protects vulnerable homeowners against misleading mortgage advertising, and loan modification agreements.

There are other mortgage assistance and foreclosure laws proposed by Oregon Housing and Community Services. To know your rights and responsibilities, seek for foreclosure counseling today. Call them at 1-800-SAFENET or visit http://www.oregonhomeownerhelp.org/ for more information.

Washington State Foreclosure Laws

Washington also uses in-court and out of court foreclosure proceedings. Judicial or in-court foreclosure is used when the language in the mortgage or deed of trust does not contain a power of sale clause. Should this be the case, the law suit must be filed in order to get a court order to proceed with foreclosure. After this has been obtained, the lender will proceed with, and auction the home.

When a power of sale clause does exist in the mortgage or deed of trust, then non-judicial or out of court foreclosure is followed. This is almost always the case.

To proceed with an out of court foreclosure in Washington, the lender must start by sending a notice of sale letter to the home owner by both regular mail and by certified mail, return receipt requested. This notice of sale must be sent to the home owners last known address.

If the home owner has an attorney of record, it must be sent to that person as well. The time frame required for this notice of sale to be sent is a minimum of thirty days prior to the sale.

Other requirements to move ahead with an out of court foreclosure in Washington include that the sheriff must publish or advertise the notice of sale once a week for four weeks leading up to the sale date. This advertisement can be placed in any newspaper that has circulation in the county where the property is located. Also the sheriff must post this notice of sale on the court house door in the county where the property is located.

The sheriff must post this notice on at least one other public place as well. These public postings must also take place four weeks before the sale date.

This notice of sale must include the time and place of the auction, the names on the deed, the date of the deed, recording info, a description of the property and the terms of the sale.

In Washington the home owner can stop the foreclosure proceedings by paying the past due payments, plus other expenses the lender has incurred in the process. Those costs will include, but in process. Those costs will include, but are not restricted to the lawyer’s fees involved. The home owner can halt the process this way as late as eleven days before the sale date.

In Washington the auction of the property is always held between 9:00 am and 4 pm on Friday at the courthouse door.

If the Friday that is closest to the date chosen by the lender happens to fall on a legal holiday, the sale will be held on the next business day. In this state, the auction cannot be held any sooner than the 190 days following the date the notice of default was issued by the lender.

The obtaining of the property by the highest bidder, in Washington, is confirmed by the receipt of a certificate of sale.

In Washington, the sheriff can postpone the sale for a maximum of 1 week. If the sheriff chooses to do so, then the notices must be posted as they were prior to the original sale date.

Home owners have an eight month right of redemption in this state. This means that should the person who lost the home at auction be able to come up with the amount of money of the winning bid at auction, plus interest, then they can again enjoy ownership of the property.

This doesn’t happen often, but it does mean that the new owner or the person who placed the winning bid must worry for eight months about whether or not the home is really theirs. If it were me, I would certainly refrain from putting anymore money into the house. I would also consider not moving into the house until the 8 months following the sale have expired.

If the lender chooses to pursue an out of court foreclosure in Washington, it forgoes any chance it might have had to pursue the borrower for a deficiency judgment. That means they can’t seek any additional money not generated by the sale of the home.

If the lender chooses to follow an in court foreclosure, they can follow that decision or out come up with and additional pursuit of the borrower for any funds they feel they are due above what is gained through a sale. The only exception to this rule is that if the property is proven to have been abandoned for six months before the decree of foreclosure was issued, by the court. In this situation, further pursuit of the borrower for money is prohibited.

Foreclosure Laws in South Dakota

Many states in the United States follow in court and out of court proceedings, South Dakota is one of them. As in all states where both forms of foreclosures are used, the vast majority of foreclosures are out of court processes. This is done because it saves the bank time and money. The determining factor as to which method of foreclosure is followed, is whether or not the mortgage or deed of trust contains a power of sale clause. This power of sale clause allows for out of court proceedings and is included in most such documents, in the absence of such language in a mortgage or deed of trust, in court foreclosures must be used.

In court proceedings begin with the bank filing a lawsuit to foreclose. It takes a while for a judge to declare a foreclosure depending on how full the docket of lawsuits are. It could be a very long time to get to this point. Once a declaration of foreclosure has been obtained from the court, the home will be scheduled for an auction, which is most commonly referred to as a trustee’s sale. The highest bidder at the sale is awarded the property and the entities most likely to receive the proceeds from the sale are first the IRS (if there is a federal tax lien on the property) and the first mortgage holder.

The actual sale of the property follows the same process in both in court and out of court foreclosures. The only difference is the time and expense necessary to file the law suit prior to moving to a sale date.

In the unusual event that the power of sale clause in the mortgage or deed of trust states a specific time, place, including terms of sale, then those instreuctions must be followed. However, most power of sale clauses are not so specific. So in most cases, the following procedure will be followed.

A notice of foreclosure will be advertised once a week for four weeks, in a local paper, that has circulation in the county where the home is located. Additionally, twenty one days before the scheduled sale date, the bank has to give a written notice of the foreclosure sale to the homeowner. Additionally, the bank is further required to give the same information to any other lien holders connected to the property.

This notice of sale needs to include the names of the home owner and the bank executing the foreclosure. It also needs to explain the mortgage date, the amount due, and contain a description of the property. It of course must also state the date, time, and place of the scheduled sale.

The sale is conducted by the sheriff of the county where the home is located. It may be run by the deputy as well. The sale will always be held between 9:00 am and 5:00 pm. The home will be awarded to the highest bidder participating in the sheriff’s sale. In South Dakota, the winning bidder will receive a certificate of sale.

Postponement of such a sale can occur at the banks discression. If the choose to execute such a postponement, they must advertise the new sale date in the same paper as the notice of sale was originally placed. Continuing the publication of the notice of the postponement date until the new sale date is reached.

Deficiency judgments are allowed in South Dakota. This means that if the bank is not satisfied with the proceeds from the sale, they can continue ton pursue the former home owner for the difference between the amount of the highest bid at the sake, and how much was owed to them on the loan. However, most lending institutions understand that a person losing their home at auction, almost always have nothing else of value for them to try to take. Consequently, deficiency judgments are rarely sought by the bank. They know it would be a waste of time and resources to try to pull water from an empty well.