Sunday, July 14, 2024
HomeForeclosureForeclosure Process In Nc

Foreclosure Process In Nc

Close On The Purchase


The closing process for pre-foreclosures and REOs is similar to closing on conventional homes â you go to a title company, fill out the paperwork, and pay the seller for the property.

The title company will tell you in advance what’s expected from you, but it helps to have an expert on your side to guide you. If you use an agent recommended by Clever, you’ll have the peace of mind knowing an experienced agent has your back â and you could even get up to 0.5% cash back at closing!

Auctions are a bit more complicated. If you submit a winning bid, you need to provide the trustee with a certified check â usually 10% of the purchase price â as a deposit.

Then, a Report of Sale will be filled out and filed at the county clerk’s office. However, there is still a 10-day upset period when someone can outbid you.

If you make it through the upset period without being outbid, you’ll need to deliver the full amount of the sale to the trustee â usually within 30-45 days.

ð¨ Don’t forget the taxes!

In North Carolina, taxes due on a property are NOT prorated, so you’ll have to pay the full amount due on them upon purchase of the property. For example, if you buy a foreclosed property in December, you don’t just owe taxes for that month, youowe them for the entire year if they haven’t already been paid.

Real Estate Owned Foreclosures

If a property doesn’t sell at auction, the lender or government takes possession of the property â these are called REOs.

REOs are good properties for buyers who want to avoid taking advantage of distressed sellers or the risk of buying site-unseen homes at an auction. That said, there can be significant delays in dealing with REOs, so these are not for buyers who are ina hurry.

In fact, REOs in North Carolina can take anywhere from 6â18 months for a property to complete the foreclosure process and be moved to an REO department.

» MORE: Learn about HomeSteps for financing REOs in North Carolina

Another important thing to remember is that REOs have failed to sell either as pre-foreclosures or at auction. That usually means there is something wrong with them.

As such, buyers should be prepared to do substantial renovations on the property, regardless of whether they want to rent it, flip it, or live in it.

If you think you’re up for this kind of renovation, HomeAdvisor can connect you with top local professionals for any home project.

Options To Prevent Foreclosure

Most foreclosures on residential homes in North Carolina use the nonjudicial process, meaning they are done out of court. However, one court appearance is usually necessary. The lender will serve a notice of hearing by certified mail either 10 or 20 days before the date of the hearing, depending on whether you were served personally or the notice was posted on your property.

Before the foreclosure proceeds, you may be able to stop the process by:

Its also vital to review your promissory note and deed of trust. In addition to the protections available to you under both North Carolina and federal law, these documents may offer various contractual rights.

Its also vital to review your promissory note and deed of trust. In addition to the protections available to you under both North Carolina and federal law, these documents may offer various contractual rights.

Additionally, if you are in the military and took out a mortgage before you were on active duty, you may be eligible for relief from foreclosure under the Servicemembers Civil Relief Act. Lenders are prohibited from foreclosing on homes of military members while they are on active duty and for one year after, so it may be possible to stop foreclosure in this situation if done right.

Read Also: Foreclosed House For Sale

The Timeframe For An Eviction

You do not have to leave the home on the same day that the house is sold. Once again, you are entitled to a notice asking you to leave, and you have ten days from the time that the new owner provides you with this notice to do so. Only when those ten days have come to a close is the new owner allowed to move forward with an eviction.

We Truly Want People To Know Your Integrity And Your Ability To Help

Understanding the Foreclosure Process in NC by Fhlres on January 23 ...

Dear Gene,

We would like to thank you for helping us in our desperate situation. It was such a blessing to us and our family. We truly want people to know your integrity and your ability to help when it looked hopeless. We were behind on our mortgage and we were not at all sure if you could help us or not. And when you called me and said you were ready to go with the deal, we were overcome with joy. Your ability to take care of everything took the stress off us. And we were able to go on with our lives. We would like to encourage all the folks that make that call to you to give your company a chance and just watch what they can do. They were the answer to our prayers. And we thank God for them and you will too.

Recommended Reading: What Information Do You Need To File For Bankruptcies

Is Hiring A Foreclosure Attorney Worth It

Do you want to keep your home or just know whether you can? Hiring a foreclosure or bankruptcy attorney is absolutely worth it if you want to save your property. Most people feel relieved after their first meeting with a law firm experienced with handling foreclosure defense and bankruptcy. The longer you wait to address your foreclosure or potential foreclosure, the worse off you will be and the harder it will be to solve those issues going forward. Contact Gillespie & Murphy, P.A. as soon as possible to get the help you need for your foreclosure related needs.

Find Foreclosed Homes In North Carolina

We recommend anyone that isn’t an investment professional stick to pre-foreclosures and REOs â these properties are more like traditional home sales and involve less risk.

You can find pre-foreclosures on your MLS , as well as sites like RealtyTracor Zillow. Usually, you just need to set search filters to focus specifically on foreclosures, pre-foreclosures, or bank-owned properties. You can also find government-owned foreclosures on the HUD home store.

Only seriously consider auctions if you’re experienced in real estate, have substantial cash reserves, and are willing to take the risk of buying a home site unseen.

You can find auctions listed in the real estate or legal notices section of your local newspapers or by searching “foreclosures” on and

Recommended Reading: How Long Till Bankruptcy Is Discharged

What Happens When You Fall Behind In A Few Payments

If you miss a few mortgage payments, your servicer will probably send a letter or two reminding you to get caught up, as well as call you to try to collect the payments. Dont ignore the phone calls and letters. This is a good opportunity to discuss loss mitigation options and attempt to work out an agreementlike a loan modification, forbearance agreement, and payment planso you can avoid foreclosure.

Tour Foreclosures In Person

North Carolina Tax Sale Basics: Tax Deed Foreclosure Overview

Since foreclosures are usually sold “as-is,” it’s important to try and see them before submitting an offer. With pre-foreclosures or REOs, you can usually see the property in person and have it inspected. This isn’t an option at auctions, meaning you have no idea what you’re in for.

If you don’t have time to order an inspection, you might try bringing in a contractor to give you a sense of what kind of work they think you’ll need to do and how much it’ll cost. For flippers and investors, this is a crucial step to figuringout the after repair value .

» LEARN: More about how ARV works

Also Check: Best Place To Buy Liquidation Stock

How To Buy A Foreclosure Property In North Carolina

Are you interested in adding real property to your 2016 portfolio before the year ends? If you have ever been curious about buying foreclosure property and potentially getting a steal, here is a general run down of the procedure and some helpful tips to get you the best deal. Here is the Sale Procedure:

1. Finding foreclosure properties to buy

Posting Board: In each county courthouse, there is a posting board where all sales must be posted for at least 21 days. Ask courthouse staff where the board is located. The posting will also have pertinent information about the sale, including date and time, rules of the sale, etc.

Trustee/Law Firm website: The seller/trustee will typically have the properties listed on their website. This is usually an easier way to sort through properties faster and get more information, such as opening bid amounts. If you happen to be interested in one of our properties, Hutchens Law Firm listings are located on our Foreclosure Sales page.

Third Party Sellers: Other companies will sometimes assist with foreclosure sales. For example, sells foreclosure properties in North Carolina.

How much is the opening bid? The opening bid is set by the foreclosing mortgage company and is typically posted on the website the week prior to the sale. However, sometimes it can be the same day or even hours or minutes prior to the sale. Note that you cannot bid before the sale begins.

2. What to expect the day of the sale

3. You WON! Now what?

Fees The Servicer Can Charge During Preforeclosure

If you miss a payment, most loans include a grace period of ten or fifteen days, after which time the servicer will assess a late fee. Each month you miss a payment, the servicer will charge this fee. To find out the late charge amount and grace period for your loan, look at the promissory note you signed. You can also find this information on your monthly mortgage statement.

Also, most North Carolina deeds of trust allow the lender to take necessary steps to protect its interest in the property. Property inspections are performed to ensure that the home is occupied and appropriately maintained. Inspections, which are generally drive-by, are usually ordered automatically once the loan goes into default and typically cost around $10 or $15.

Other types of fees the servicer might charge include those for broker’s price opinions, which are like appraisals, and property preservation costs, such as for yard maintenance or winterizing an abandoned home.

You May Like: Can You Be Bonded After Bankruptcy

Deficiency Judgments Following The Sale In North Carolina

Sometimes, when a home sells at a foreclosure sale, the sale doesn’t bring in enough money to pay off the full amount owed on the loan. The difference between the sale price and the total debt is called a “deficiency balance.” Many states allow the lender to get a personal judgment, which is called a “deficiency judgment,” for this amount against the borrower.

In North Carolina, the lender can get a deficiency judgment after a nonjudicial foreclosure, except in certain instances, like after the foreclosure of a purchase money, seller financed mortgage or deed of trust. . The lender might also be barred from seeking a deficiency judgment in certain cases when the mortgage or deed of trust is:

  • nontraditional or is a rate spread home loan , and
  • secures the borrower’s principal residence. .

How Judicial Foreclosures Work

Understanding the Foreclosure Process in North Carolina  CALL (919 ...

A judicial foreclosure begins when the lender files a lawsuit asking a court for an order allowing a foreclosure sale. If you don’t respond with a , the lender will automatically win the case. But if you choose to defend the foreclosure lawsuit, the court will review the evidence and determine the winner. If the lender wins, the judge will enter a judgment and order your home sold at auction.

Also Check: How To View Bankruptcy Records Online

Guide To The North Carolina Foreclosure Process

Eligible homeowners in North Carolina who’ve experienced a financial hardship because of the pandemic can get a piece of the approximately $273 million allocated to the state from the federal Homeowner Assistance Fundup to $40,000 per householdthrough the North Carolina Homeowner Assistance Fund program. This program uses federal money to help homeowners in North Carolina make mortgage payments and pay other housing-related costs.

Also, while the COVID-19 national emergency continues, homeowners with a federally backed mortgage loan, regardless of delinquency status, who’re experiencing a financial hardship due directly or indirectly to COVID-19,can get a forbearance. Even if your loan isn’t federally backed, your servicer might offer a forbearance or another form of relief, like a loan modification, if the COVID crisis has financially impacted you.

If you fall far enough behind on your mortgage payments in North Carolina, your loan servicer will start a foreclosure, most likely a nonjudicial one. North Carolina law sets out the specifics of the nonjudicial foreclosure process. Assuming you dont successfully fight the foreclosure or work out a way to avoid it, your home is then sold to a new owner at a foreclosure sale.

Heres a detailed description of what usually happens in a North Carolina foreclosure so that you know whats supposed to happen and what you can do if you want to try to save your home.

Federal Mortgage Servicing Laws And Foreclosure Protections

Under federal mortgage servicing laws, the servicer must contact, or attempt to contact, you by phone to discuss loss mitigation options, like a loan modification, forbearance, or repayment plan, no later than 36 days after you miss a payment and again within 36 days after each following delinquency. No later than 45 days after missing a payment, the servicer has to inform you in writing about loss mitigation options that might be available and appoint personnel to help you try to work out a way to avoid foreclosure. A few exceptions are in place for some of these requirements, though, like if you’ve filed bankruptcy or asked the servicer not to contact you pursuant to the Fair Debt Collection Practices Act. .

Federal mortgage servicing laws also prohibit dual tracking .

Don’t Miss: What Happens When You Declare Personal Bankruptcy

Special Proceeding Foreclosures On Behalf Of Beneficiary Creditor Or Trustee

Irvine Law Firm assists both individual and commercial creditors who need to collect a debt through foreclosure. When a creditor lends money that is secured by a debtors real estate, the debtor executes a promissory note and deed of trust. If the debtor fails to pay as required by the promissory note, the Trustee named on the deed of trust will file a Special Proceeding in the Office of the Clerk of Superior Court in the county where the land is located. Irvine Law Firm can serve as Substitute Trustee or local counsel for the Substitute Trustee.

Irvine Law Firm is glad to offer services as Substitute Trustee or local counsel for the Substitute Trustee in any county in North Carolina.

If you would like an overview of the foreclosure process, please review our Foreclosure Time Line. For more information, see our Foreclosure FAQ section.

General Foreclosure Information

Debtor-the person who owes the money and signed the promissory note.

-the person or entity to whom the money is owed.

Owner-the person who owns the property given as security for the debt owed to the creditor. The owner and debtor are often the same person, but do not have to be.

Trustee-the Trustee is the middle man between the debtor and creditor. It is the Trustee who files the foreclosure hearing and has the duty of selling the pledged property in order to pay the debt to creditor.

Security-the property that is pledged as security for debtors promise to pay creditor .

Foreclosure Hearing

Foreclosure Sale

How Does Foreclosure Work In North Carolina

What is the Process of buying a foreclosure?

A foreclosure proceeding can be initiated by a lender when a homeowner defaults on their mortgage payments. Once the foreclosure process is complete, the lender can take back the home and sell it at auction. The house is sold to the highest bidder, who can proceed to take possession immediately.

Notably, there are many legal requirements a lender must adhere to before commencing foreclosure proceedings. Generally, a lender cannot begin a foreclosure until you are behind on your mortgage payments by 120 days or more. The period prior to the actual foreclosure is known as preforeclosure. While the servicer is permitted to charge late fees for missed payments during this time, they must also send you a breach letter and inform you regarding how you can avoid foreclosure.

Under federal law, a mortgage servicer is obligated to contact you by telephone or attempt to make contact with you to discuss options that might be available to you to prevent foreclosure. Critically, they must do so no more than 36 days after you have missed your first payment and again after each subsequent missed payment. The servicer must also send you a notice no more than 45 days after you missed a payment advising you of your loss mitigation options and appoint someone to work with you to prevent foreclosure.

You May Like: Can They Take Your Home If You File Bankruptcy

Phase : Notice Of Default

A notice of default is sent after the fourth month of missed payments . This public notice gives the borrower 30 days to remedy past due payments before formally starting the foreclosure process.

Most lenders will not send a notice of default until the borrower is 90 days past due . Thus, many times a borrower can fall behind a month or two without facing foreclosure.

Generally, federal law prohibits a lender from starting foreclosure until the borrower is more than 120 days past due.


Popular Articles