North Carolina Laws

Non-judicial North Carolina foreclosures are much more common than judicial foreclosures, which are generally only needed when there are problems with the title to a property or a mortgage does not contain a Power of Sale clause. The Power of Sale clause allows the lender to pursue foreclosure without the supervision of a court, and is very common in North Carolina.

However, before even a non-judicial foreclosure can begin, the court must issue a preliminary order to allow the foreclosure. The lender first files for the ability to foreclose and then the court schedules a hearing on the matter. If they decide a default has in fact occurred, they will grant the lender permission to pursue a foreclosure on their own. The homeowner can stop the sale by paying off the default amount owed at any point before the sale begins.

Before a sale, the lender must publish a Notice of Sale in a local weekly newspaper for two weeks leading up to the date of sale. The Notice must also be posted on the door of the county courthouse and the property in question. The homeowner must be served with a copy of the Notice of Sale at least 20 days prior to the sale itself.

On the date in question, a trustee of the lender will auction off the property to the highest bidder. If the sale must be postponed, the lender must post notice of the postponement on the courthouse door. Once a winning bidder is determined, the original homeowner is allowed ten days in which to redeem ownership by paying the default amount owed. If this does not happen, the winning bidder assumes full ownership. The lender is entitled to pursue a deficiency judgment against the homeowner if the proceeds from the sale do not satisfy the amount of the original loan provided.

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