If you are facing foreclosure or you are simply involved with potentially purchasing a property in Georgia which is in foreclosure, it is important to be aware of some of the key facts that pertain to Georgia foreclosure laws. This is because the laws will vary from state to state which makes the foreclosure process different for each area.
First, it is important to mention that the Georgia laws allow for in-court and out-of-court proceedings on a property in foreclosure. If an in-court proceeding takes place the process can typically be longer than an out-of-court proceeding which can take as little as a couple of months.
Court vs. Out-of-Court Proceeding
If you are confused as to why there are two different types of foreclosure proceedings according to the Georgia law, the two proceedings are used according to situational factors regarding the property in foreclosure. If there are complications with the property in question, a court proceeding is used. On the other hand, if there are no complications an out-of-court proceeding can be used by the lender.
The purpose of a court proceeding is to rectify any problems associated with the mortgage deed. For example, if the deed whether or not mortgage or trust, does not contain a clause which allows for a proceeding outside the court then a court proceeding must be used if the property falls into foreclosure. Or, if the title is not free and clear then a court proceeding is necessary.
The process for a court proceeding begins when the lender on the mortgage files a petition which contains a description of the property circumstances plus the amount of the back payments which are owed on the property. Once the petition is filed, the borrower will receive a notice from the court stating that they have up to one month to satisfy the payments which are in arrears. The payment must be made to the court and in the event this is not possible then a foreclosure sale date is scheduled by the court.
In the case of an out-of-court proceeding, the lender has the authority to schedule a foreclosure sale provided there is a clause in the mortgage deed that allows for a sale outside the court system. Out-of-court proceedings are more common since the majority of lenders make sure this type of clause is included in the mortgage deed.
An out-of-court proceeding is initiated when the lender schedules a foreclosure sale. According to the laws in the state of Georgia the lender is not required to provide advance notice of foreclosure proceedings to the borrower unless there is a clause in the mortgage that requires it. However, at any time the borrower can prevent the foreclosure process by paying off the balance that is owed on payments which are in default.
According to the Georgia laws, satisfying the payments which are in arrears does not automatically entitle the borrower to reinstatement but, if the entire loan balance is paid this will prevent any further foreclosure proceedings.
Once a foreclosure sale has been scheduled, according to the laws in the state of Georgia a weekly notice of the sale is posted in the weeks preceding the sale. The laws also state that the borrower must be notified at least 30 days in advance and the notice must contain all of the information which pertains to the mortgage.
If the foreclosure sale is conducted in the form of an auction the laws state that it must take place during the first week of any given month. If for any reason the sale does not occur then another date for a foreclosure sale is scheduled. Once the sale is complete, the law requires a confirmation hearing to be scheduled with notification of the hearing sent to the borrower at least five days in advance. In the event the sale of the property does not meet market value another sale is scheduled at the time of the confirmation hearing.
According to the laws of the state of Georgia the borrower is not entitled to right of reinstatement if the payments in default are satisfied. The buyer is also not allowed to purchase the property back from the person who bought it at the foreclosure sale unless the property is sold in a judicial foreclosure.