Know Foreclosure Rules And Save The House

September 25th, 2007

The foreclosure is a time consuming legal process. In North Carolina property can be foreclosed either through a trust-deed-sale or by judicial action. The latter is rarely applied. The mortgage consists of a document consisting of two parts. The deed of trust is the third part – it is between the borrower, lender and the trustee. The latter hold the title until loan is paid up. Usually the trustee belongs to the lender’s camp.

When the foreclosure ball starts to roll the lender sends a notice to the borrower granting 30 days time for paying dues. After expiry date the trustees file a notice of hearing at the Superior Court of the county in which the unit is located for a hearing date. The borrower must personally receive the notice well in advance. It contains the date, time and location of the hearing. The notice may be sent by ‘first-class mail, return receipt requested.’ If borrower is untraced then the notice is pasted on the property not less than 20 days before the date.

At the hearing the trustee has to prove validity of the debt, its default and that the lender has the right to foreclose. Also it must be shown that the notice was timely served to the proper person/place. The borrower has the right to contest any of the four points. If the court is satisfied then the foreclosure proceedings will be stalled. Otherwise the trustee will be directed to sell the unit. The latter then files a notice for sale and posts in the court 20 days in advance of the sale date. It is also published in a newspaper of the county once a week for two consecutive weeks. The notice is posted to the borrower. The specifications of the property and the date, time as well as the venue of the sale must be clearly stated.

The trustee conducts the sale by collecting deposit from the winning bidder and files first hand report of the sale within 5 days. The high bid is not closed for 10 days. With a fresh high bid another 10 days is added for another similar bid. During these 10 days the borrower may pay off past dues. With the receipt of the sale money the deal is closed and a final notification of the same has to be given to the court.