Foreclosure Homes Atlanta GA
Buying foreclosure homes in Georgia could be an out of court settlement or in the court settlement. It is a user discretion state. However, the terms for which the lender would want a court settlement may be different. The court will be involved in cases where the power of sale was not mentioned in the mortgage agreement, or when there has been a deficiency judgment.
The first circumstance for a court sale is “The power of sale” clause that authorizes the lender to carry out the sale without the courts permission, and only by recording a complaint with the court. The agreement says that the lender can take possession of the property in case the borrower has defaulted on the payments. The default period is defined as 60 days legally, and any borrower who has crossed the 60 days time period is considered to be a defaulter. However, the court will decide if the borrower is a defaulter or not.
The second circumstance for a court settlement is when there has been a deficiency judgment which means that the property was auctioned off for much less than its fair market value, or the amount is less than the mortgage amount itself. This rarely happens, but there have been cases where this took place.
In that case the court will rule the entire sale as void, and the money is returned to the respective bidder. After all the amounts that were collected are cleared, a fresh new start is made by the lender. The borrower gets lucky in this case because the time period to pay off the loan is almost doubled. The lender would have to start afresh by lodging a new complaint and starting over with the foreclosure process again.
While filing a case against the borrower, or informing them about the default, the lender would need to submit the mortgage agreement and the details of the loan to the court. The court investigates these documents thoroughly and acknowledges the complaint. This process could take up to 30 days. After this the borrower is sent a letter by the court to pay the dues to avoid a foreclosure, and is given 30 days time to respond. If the borrower responds, then there would be a hearing scheduled in a couple of weeks so that the borrower could have a chance to explain.
If the borrower cannot agree with the courts terms to pay, or is unable to pay, then the property will be auctioned. Usually at this point some agreement is reached by most lenders to clear the loan amount. A foreclosure sale is declared at this point, and the borrower is still given the time to clear the dues. At this point the lender may wish to accelerate the loan amount by demanding the entire loan amount to be paid off.
This would also need to be authorized by the court, and copy of it is given to the borrower. The notice of sale needs to be advertised in the news paper for three weeks and mailed to the borrower. Apart from this, it has to be posted in two public places and the property itself. After the auction is finalized and the property has been sold in the auction, the borrower loses all right to reclaim the property.
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