Understanding the foreclosure process in TN is an important part of navigating your own home foreclosure.
Understanding the Foreclosure Process in TN
What is foreclosure anyway?
Foreclosure is the legal process that lenders use to take back property that is secured by a loan/mortgage. This usually happens after the borrower stops making payments.
Foreclosure is no fun. But just know that it’s not the end of the world.
It’s important to know how the foreclosure in TN works… it arms you with the knowledge you need to make sure you navigate it well and come out the other end as well as possible.
The Basic Stages of A Foreclosure
There are 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 non-judicial sale. TN is a non-judicial state.
Connect with us by calling (615) 310-1909 or through our contact page to have us walk you through the specific foreclosure process here locally in Murfreesboro.
In either scenario, the foreclosure process usually doesn’t start until you have missed 3-6 months of missed payments. Usually (but not always), a lender will send out several notices that you are behind on 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 Non-Judicial Foreclosure:
- The mortgage lender serves you with papers demanding payment. The courts are not required to be involved in this portion of the process.
- If you don’t get caught up or work out some sort of loan modification with the lender at some point they will draw up a Deed Of Trust and transfer control of your property over to a Substitute Trustee. You are typically notified of this but not always. These are the guys that handle the foreclosure for the lender
- The Substitute Trustee will publish a Notice Of Default for three consecutive weeks in a local paper along with the public auction date.
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 is complete, the loan amount is paid off with the sale proceeds. You typically have 30 days to vacate or the Sheriff’s Department will literally come and set your belongings out on the curb…
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. This is where the bank gets a judgment against you, the borrower, for the remaining funds owed to the bank on the loan amount after the foreclosure sale.
How To Avoid A Foreclosure Auction?
If you need to sell a property near Murfreesboro, we can help you. If wait too long the best bet is a cash as-is offer. We have funds available to close quickly. We can usually work with you on the move out date. Leave unwanted items behind.
If you see there is just no way you will ever get caught up, and don’t wait until the last minute, depending on your circumstances we can list your house on the MLS for you. It’s a bit more hassle than a cash sale but you will probably net more.
The main thing is don’t wait too long!!
Give us a call anytime (615) 310-1909 or
fill out the form on this website today! >>
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