Dealing with the possibility of a home foreclosure can be an incredibly stressful and confusing time. Understanding the laws and procedures associated with foreclosures can also be complex. Let’s review bank foreclosures in Virginia and some of your potential options if you are facing a foreclosure.
The 120-Day Rule to Apply for Foreclosure Alternative
The 120-Day Rule, under the federal Mortgage Servicer Rules, provides a window for homeowners to explore foreclosure alternatives. During the first 120 days after you start missing mortgage payments, the lender or service provider can’t initiate a foreclosure process. This period is meant for homeowners to communicate with their mortgage service providers to apply for alternatives such as a loan modification, short sale, or deed in lieu of foreclosure.
Types of Foreclosures
Non-Judicial Foreclosures
Virginia is primarily a nonjudicial foreclosure state, which means that the lender does not have to go through the court system to foreclose on your home. Instead, the process is administered outside the court system, following the procedures outlined in the mortgage or deed of trust. In general, this process is faster than a judicial foreclosure and can be more difficult for homeowners to fight.
Judicial Foreclosures
Judicial foreclosure, on the other hand, involves filing a lawsuit in court and receiving court approval to foreclose. In Virginia, this method is less common than nonjudicial foreclosures. While the process takes longer, it does give the homeowner a chance to present a defense in court.
Deficiency Judgments and Owing Post-Foreclosure
In Virginia, if the foreclosure sale doesn’t cover the full amount owed on the mortgage, the lender can seek a deficiency judgment. This is a court judgment against the borrower for the remaining amount of the debt. However, this is not automatic; the lender has to actively pursue it in court.
Virginia Has no Reinstatement Right for Borrowers
Unlike some other states, Virginia does not grant borrowers a statutory right to reinstate the loan before the foreclosure sale by catching up on missed payments. However, your mortgage agreement might allow reinstatement, so it is important to read and understand the terms of your mortgage.
Virginia Has to Right to “Redeem” or Buy Back the Home Post-Sale
Another aspect unique to Virginia law is that there is no statutory right of redemption, or the right to reclaim your home after a foreclosure by paying off the full amount of the loan plus any costs. The one exception is that if the foreclosure was judicial, borrowers have up to 10 days post-sale to redeem.
Get in Touch with the Law Offices of Robert S. Brandt for Help with Bank Foreclosures in Virginia
Foreclosure is a complicated process, and having an experienced attorney by your side can make all the difference. The Law Offices of Robert S. Brandt are committed to helping Virginia residents navigate the complexities of foreclosure laws. If you’re facing bank foreclosure in Virginia, don’t go through it alone. Get in touch to schedule a confidential consultation.