Foreclosure & Alternatives Law
For homeowners facing foreclosure, the fear of the unknown is almost as great as the fear of losing their house. Below, you will find information on the foreclosure process in Delaware; however, it is always a good idea to speak with an attorney about your options.
Most foreclosures in Delaware begin when the borrower is three to four payments behind. The total time for a foreclosure to occur from start to finish is about 175-200 days. This can differ depending on how busy the court is in the county where the property is located.
Most foreclosures in Delaware begin when the borrower is three to four payments behind. Unlike some other states, Delaware only allows judicial foreclosure. Lenders do have several options for pursuing this type of foreclosure. The most common, however, is the Scire Facias. This is quite different from other types of foreclosure. This is because the borrower has to prove that he or she hasn’t defaulted on the mortgage rather than the lender proving the borrower did default.
In a Scire Facias, the lender files an order with the court for foreclosure. The borrower will be served this paperwork. The borrower can contact a housing counselor to discuss his or her options; however, an attorney would likely have more knowledge about possible ways to delay the foreclosure.
The borrower has 20 days to show the court evidence as to why the foreclosure should not happen. If the court is not satisfied with the reasons and evidence that the borrower provides, then the court will authorize a sale of the property.
A foreclosure sale occurs at a public foreclosure auction. While Delaware does not have a statutory right of redemption, there is usually a confirmation hearing. A statutory right of redemption allows borrowers to make the full payment of the loan plus costs to the lender. A confirmation hearing is held 30 days after the sale, and the borrower can redeem the loan during that 30 days but not after.
A notice of the foreclosure sale must be posted on the property and throughout the county 14 days prior to the sale. The sale is conducted by the sheriff and can be held at either the property or the courthouse.
A deficiency judgment means that the property sold during the foreclosure sale for less than what the balance of the loan was. As a result, the borrowers will still owe the lender the difference between the amount of the loan and what the property brought at auction.
When facing a foreclosure, an experienced attorney can provide information on the legal options available to a homeowner. While not all of these options may result in the homeowner keeping his or her home, it may buy the homeowner some time before having to vacate the property. There are other options available, such as bankruptcy, too, that may be beneficial.