The foreclosure process in Georgia is a relatively quick process once officially started, taking only a couple of months. Don’t be caught off guard if you are facing a potential foreclosure. Read on to learn about each step in a Georgia foreclosure from missing your first payment all the way to eviction. (For more articles on Georgia foreclosure law and programs to help you avoid foreclosure, visit Nolo's Georgia Foreclosure Law Center.)
A promissory note is basically an IOU that contains the promise to repay the loan, as well as the terms for repayment. The Security Deed provides security for the loan that is evidenced by a promissory note.
If you miss a payment, most loans include a grace period of ten or fifteen days after which time the loan servicer will assess a late fee.
The late fee is generally around 5% of the overdue payment of principal and interest. To find out the late charge amount and grace period for your loan, look at the promissory note that you signed. This information can also be found on your monthly mortgage statement. (Learn more about fees that the lender can charge if you’re late on mortgage payments.)
If you miss a few mortgage payments, your servicer will probably send a letter or two reminding you to get caught up, as well as call you to try to collect the payments. Don’t ignore the phone calls and letters. This is a good opportunity to discuss loss mitigation options and attempt to work out an agreement, like a modification, forbearance agreement, or payment plan.
Under federal law, the servicer usually has to wait until you're 120 days delinquent on payments before making the first official notice or filing for any judicial or nonjudicial foreclosure. This time period is supposed to give you sufficient time to explore loss mitigation opportunities.
Most residential foreclosures in Georgia are nonjudicial, which means the lender can foreclose without going to court so long as the Security Deed contains a power of sale clause. (A “power of sale clause” is a paragraph in the Security Deed that authorizes the nonjudicial foreclosure.)
No later than 30 days prior to the date of the scheduled foreclosure sale, the lender must send the borrower notice of the initiation of proceedings to exercise a power of sale. The notice must be sent via registered mail, certified mail, or overnight delivery, return receipt requested, to the property address or to any other address the borrower has designated by written notice to the lender.
The notice will include:
(To get more information about loan modifications, see How to Get a Mortgage Loan Modification.)
The foreclosure sale must be advertised in the official county newspaper where the property is located once a week for four consecutive weeks before the scheduled sale date.
The lender’s attorney will also usually send the borrowers a notice informing them they have ten days from the receipt of such notice to pay the principal and interest without incurring attorneys' fees. This notice is often included with the 30-day notice of sale.
There is no statutory right to reinstate the loan prior to the sale in Georgia, except for high-cost home loans. But most Security Deed contracts, such as the conventional Fannie Mae/Freddie Mac Security Deed, provide the borrower the right to cure the default after acceleration and reinstate the loan, usually at any time prior to five days before the foreclosure sale in a nonjudicial foreclosure.
Foreclosure sales are generally held at the county courthouse on the first Tuesday of the month (unless that day is New Year's Day or the 4th of July, in which case foreclosures are held on the Wednesday of that week) between 10:00 A.M. and 4:00 P.M.
The property will be:
At the sale, the lender will typically make a credit bid in the amount of the debt plus costs. However, if the lender intends to pursue a deficiency judgment, then the property must appraised before the sale to ensure that the lender bids the fair market value of the property.
When a lender forecloses, the total debt owed by the borrower frequently exceeds the foreclosure sale price. The difference between the sale price and the total debt is called a “deficiency.”
In some states, including Georgia, the lender can seek a personal judgment—called a "deficiency judgment"—against the borrower to recover the deficiency.
To get a deficiency judgment, the lender must file a report of sale with the superior court of the county in which the land is located within 30 days after the nonjudicial foreclosure sale. If this deadline is missed, then the lender can't get a deficiency judgment.
Then, the court will hold a hearing before it confirms the sale. The lender must serve the borrower with notice of the hearing at least five days prior to the hearing date. At the hearing, the court will verify that the foreclosure sale price is at least as much as the fair market value of the property. The court will also evaluate whether or not the lender followed proper foreclosure procedures by looking at:
If the court confirms the sale, the lender can file a lawsuit against the borrower to get a deficiency judgment. If the sale was not proper, the court may order a resale of the property. (Learn more about Deficiency Judgments After Foreclosure in Georgia.)
Georgia law doesn't provide a statutory right of redemption after the foreclosure. (A redemption period is the legal right of a mortgage borrower in foreclosure to pay off the total debt, including the principal balance, plus certain additional costs and interest, in order to reclaim the property.)
In Georgia, once a home has been foreclosed, it can't be redeemed.
If you don’t vacate the property following the foreclosure sale, the new owner will likely:
If you need help understanding Georgia's foreclosure laws, want to fight the foreclosure, or have questions about your particular circumstances, consider contacting a local foreclosure attorney.
Homeowners facing foreclosure are also encouraged to contact a HUD-approved housing counselor to discuss various ways to avoid a foreclosure.