The foreclosure process in Georgia can be scary without knowing the facts. Read this before you fight the foreclosure process in Georgia!
Before we dive in…
What is foreclosure anyway?
Foreclosure is the legal procedure that lenders use to take possession of a property securing a loan, generally after the borrower stops making payments.
Foreclosure in Georgia is no fun. But just know that it’s not the end of the world.
When you know how a foreclosure procedure in Georgia works… it arms you with the knowledge to make sure you navigate it well and come out the other end as well as possible.
The Basic Stages of A Foreclosure
There’s a few stages that are important to any foreclosure process.
Foreclosure works differently in different states around the country.
The two ways different states use to foreclose upon a property are: judicial sale or power of sale. The foreclosure process in Georgia is considered Power of Sale.
In either scenario, foreclosure typically doesn’t go to court until 3-6 months of missed payments have elapsed. Usually (but not always), a lender will send out many notices that you are in arrears – overdue or behind in your payment.
Under Judicial Foreclosure:
- Your mortgage lender must file suit in the court system.
- You’ll get a letter from the court demanding payment.
- Assuming the loan is valid, you’ll have 30 days to bring payment to court to avoid foreclosure (and sometimes that can be extended).
- If you don’t pay during the payment period, a judgment will be entered and the lender can request the sale of your property – usually through an auction.
- Once the property is sold, the sheriff serves an eviction notice and forces you to immediately vacate the property.
Under Power of Sale (or Non Judicial Foreclosure): Foreclosure Process in Georgia
- The mortgage lender serves you with papers demanding payment, and the courts are not required – although the process may be subject to judicial review.
- After the established waiting period has elapsed, a deed of trust is drawn up and control of your property is transferred to a trustee.
- The trustee can then sell your property for the lender at a public auction (notice must be given).
In Georgia, Notice of default must be published in the local circular newspaper for that county for four consecutive weeks (which makes fighting foreclosure in Georgia very fast paced). After that, the trustee will hold a public outcry to auction the house off to the highest bidder at the courthouse steps the first Tuesday of the next month. Anyone who has an interest in the property must be notified during either type of foreclosure.
For example, any contractors or banks with liens against a foreclosed property are entitled to collect from the proceedings of an auction.
What Happens After A Foreclosure Auction?
After a foreclosure process in Georgia is complete, the loan amount is paid off with the sale proceeds.
Sometimes, if the sale of the property at auction isn’t enough to pay off the loan, a deficiency judgment can be issued against the borrower.
A deficiency judgement is where the bank gets a judgement against you, the borrower, for the remaining funds owed to the bank on the loan amount after the foreclosure sale. Example: If the house sells for $60,000 and you owe $75,000, they can hold you responsible for the remaining $15,000.
Some states limit the amount owed in a deficiency judgment to the fair value of the property at the time of sale, while other states will allow the full loan amount to be assessed against the borrower.
Here’s a great resource that lists the state by state deficiency judgement laws, since every state is different.
Generally, it’s best to avoid a foreclosure auction. Instead, call up the bank, or work with a reputable real estate firm like us at Real Estate Problem Solver to help you negotiate discounts off the amount owed to avoid having to carry out a foreclosure.
Experienced investors can help you by negotiating directly with banks to lower the amount you owe in a sale – or even eliminate it, even if your home is worth less than you owe.
Ideas To Fight Foreclosure
- Do a monthly budget. As soon as you see money getting tight, stop and rethink your position. Get rid of the unnecessary things that cost.
- Look into a HARP program before you get behind. They can help lower payments. It’s hard to find foreclosure help (except us, of course) after the process has started.
- Shop around on your insurance. Many people are paying too much for homeowners insurance and it costs them almost $20-$75 a month in escrow payments that could make the difference.
- As soon as you get a “notice of default” from the bank, call us, We can help. We may not stop the foreclosure process once it gets too far, but we can help get you back into homeownership sooner
Fighting against foreclosure is much easier than trying to stop foreclosure at the last minute. DON’T WAIT!!
If you need to sell a property near Warner Robins, we can help you.
We buy houses in Warner Robins Georgia like yours from people who need to sell fast.
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Other Foreclosure Resources For Warner Robins Georgia HomeOwners: