Foreclosure & Alternatives Law
A foreclosure occurs when the homeowner does not make the payments as promised. In North Dakota, judicial foreclosures are by far the most common. These are foreclosures that must be finalized by a judge. There are specific timelines that must be followed in North Dakota when it comes to filing a foreclosure. If these timelines are not met, then the foreclosure may not be valid.
The lender is required to notify the borrower at least 30 days and not more than 90 prior to filing a foreclosure action. This notice must be sent to the homeowner by certified or registered mail. This notice must contain the date and amount of loan, a description of the real estate and the specific amounts due for principal, taxes and interest. It must also include a statement that tells the homeowner that he or she has 30 days to pay the amount in full or the foreclosure lawsuit will be filed.
The borrower can pay the delinquent amount, plus the costs of the foreclosure, any time before the sale actually occurs. In North Dakota, the sale must be completed in the county where the property is located and it must be carried out by the sheriff or a sheriff's deputy. Before the sale date, the county clerk must advertise the sale in a local paper for three weeks in a row.
The highest bidder will win the auction, although the lender often opens the bidding with the amount of the loan. The person or entity with the highest bid will be given a certificate of sale, which will be good until the homeowner is no longer able to redeem the property. In most cases, the homeowner can pay off the loan, plus all associated costs, within one year and the property still belongs to him or her. However, if the mortgage paperwork states that there is a short-term redemption period, then the homeowner will have six months.
In North Dakota, a lender is able to get a deficiency judgment against a property owner, but only if the property in question has more than five units and on 40 acres or less. The property owner must live in one of the units. Those property owners affected by a deficiency judgment will be responsible for the difference between the loan balance and the selling price of the property in the foreclosure sale. By obtaining a judgment, the lender then has legal possibilities for collecting any monies owed. However, the foreclosure complaint must state whether or not the lender plans to seek a deficiency judgment against the property owner.
The news of foreclosure can seem defeating to many people. Most have worked hard to keep foreclosure at bay. However, there are legal options available to some homeowners that can delay or stop foreclosures. To learn more about these options, it is advised that you seek the advice of an experienced attorney.