Under Georgia law, your mortgage lender can foreclose and take your house away in as little as 39 days. However, you have several powerful options to save your home, even if you are months or years behind in your payments. The more certain and least expensive way to save your home involves filing a Chapter 13 bankruptcy. But bankruptcy is not the only option as we will discuss in this article.
Why Mortgage Lenders Can Foreclose in Only 39 Days
Georgia law allows for what is called “non-judicial foreclosure.” This means that your mortgage company does not have to go to court to get permission from a judge to foreclose. Loan agreements for Georgia real estate contain language that allows lenders to foreclose on a delinquent mortgage after they have given you written notice and advertised the pending sale in the legal newspaper for your county.
Technically, a lender could give notice and run advertisements in as little as 39 days. As a practical matter, we rarely see foreclosure happen that fast, but our experience has been that once your home loan falls sixty to ninety days delinquent, there is a good chance that the lender will start advertising for a foreclosure sale.
So, if you stop paying on your home loan, it is likely that your home will be scheduled for a sale on the courthouse steps within about three to five months. So if you have fallen behind on your mortgage, do not ignore mail – either registered mail or regular mail – from your mortgage lender.
How Does Foreclosure in Georgia Work?
Generally speaking if you fall behind a month or even two months, the lender will advise you that your loan is “delinquent.” If you can catch up the missed payments and late fees, your loan will go back to “current status.”
If you cannot cure the delinquency, the lender will declare your loan as being in default. Under the terms of your loan, once your loan is in default the entire remaining balance will now be due (this is called an “acceleration.” Once the loan is accelerated, you cannot bring it current by paying the missed payments. The lender can agree to undo the acceleration and default but they are not obligated to do so.
Once your loan has been deemed to be in default, the lender will then start the foreclosure process. They will send their file to a foreclosure lawyer who will then start advertising your home for sale in the newspaper (every county has an official “county organ” or newspaper where foreclosure notices go.
The foreclosure notice will run for four consecutive weeks and then your house will be sold by auction on the steps of your county courthouse. Foreclosure sales occur only on the first Tuesday of the month.
Once the foreclosure sale has been concluded, you lose ownership of your house and will be evicted.
How to Stop a Pending Foreclosure
There are only three ways to stop a pending foreclosure in Georgia:
1. Convince the mortgage company to stop the process voluntarily. I have been able to do this two or three times over the past 25+ years. I was able to show that the lender used a bad address to send notice to my client. As a rule, however, once the foreclosure process starts, it is very unlikely that the lender will back down voluntarily.
2. Ask the Superior Court in your County for relief. If you have evidence that the foreclosure is wrongful – for example, you can prove that you made payments that the mortgage company denies receiving, or that there was some fraud committed by the mortgage company, you can ask a Superior Court judge to stop the pending foreclosure.
There are several practical problems with the Superior Court option. The biggest issue involves time. It can take several weeks to get a court date to appear before a judge. Meanwhile, as we have seen, the foreclosure process moves very quickly. You may not be able to get a court date before the foreclosure date.
Secondly, the Superior Court judge will only stop a foreclosure if there is a legal reason to do so. Your job loss, family illness or any other reason for not being able to keep your loan current does not count. The judge will expect to see evidence of fraud, lack of notice or miscalculations. And judges don’t always make their decisions right away.
Finally, you will incur significant legal fees to hire a lawyer to challenge a foreclosure in Superior Court. For many people, therefore, the Superior Court option is not feasible.
3. Chapter 13 bankruptcy – Chapter 13 is the fastest and most certain way to stop a foreclosure. The minute you file Chapter 13, the bankruptcy court creates a “automatic stay” that creates a legal bar to foreclosure. Your lawyer can electronically file a Chapter 13 at 7:00am on foreclosure Tuesday and any foreclosure that is called out thereafter would be invalid.
Chapter 13 is also cost effective and will also address any other debts you may have.
While Chapter 13 is a very robust solution, you do have to qualify and that’s how Ginsberg Law can help you. You can read more about Chapter 13 bankruptcy on this website, or learn about it on our video channel. Or simply pick up the phone and call us – we are happy to speak with you about how to stop your pending foreclosure.