How Judicial Foreclosure Works

Learn the basics about judicial foreclosures.

Foreclosure happens when you fall behind on your house payments and your lender uses state procedures to sell your house. Foreclosure works differently in different states. In some states, the lender has to file a lawsuit to foreclose (judicial foreclosure), while in others, it can foreclose without going to court (nonjudicial foreclosure).

Here's a rundown of the basic procedures for judicial foreclosure. To learn about nonjudicial foreclosure, see Nonjudicial Foreclosures.

Judicial Foreclosure

In a judicial foreclosure, the lender must file a lawsuit to get the foreclosure started. A judicial foreclosure typically takes several months or more, giving you time to look for another place to live, and to save some money for the future. Another advantage is that you can raise in court any legal defenses you may have to the foreclosure (without having to file your own lawsuit).

States Using Judicial Foreclosure

With some exceptions, foreclosures go through court in these states:

  • Connecticut
  • Delaware
  • District of Columbia (sometimes)
  • Florida
  • Hawaii
  • Illinois
  • Indiana
  • Iowa
  • Kansas
  • Kentucky
  • Louisiana (executory proceeding) Maine
  • Nebraska (sometimes)
  • New Jersey
  • New Mexico
  • New York
  • North Dakota
  • Ohio
  • Oklahoma (if the homeowner requests it)
  • Pennsylvania
  • South Carolina
  • South Dakota (if the homeowner requests it)
  • Vermont
  • Wisconsin

Procedures in a Judicial Foreclosure

Here's how a typical judicial foreclosure might proceed.

You get behind in your mortgage payments. Under federal law, in most cases, the lender must wait until you are more than 120 days delinquent in payments before starting a foreclosure.

The lender sends a letter notifying you of its intent to begin foreclosure. In some cases, the lender sends a letter (a "breach" letter) informing you that a foreclosure will begin unless you make up the missed payments, plus costs and interest.

The lender files a lawsuit. If you don't make up the missed payments, the lender will then go to court and file a lawsuit asking the court for the right to sell the home and apply the proceeds from the sale to the debt. If state law allows for it, the complaint might also ask the court to grant a deficiency judgment if selling the property won’t fully pay off the debt. If granted, you remain responsible for the outstanding balance left on the loan after the foreclosure sale. Some states don't allow deficiency judgments under certain circumstances.

The lender gives you notice of the lawsuit. The lender does this by delivering a summons and complaint to you (called "serving you with" a summons and complaint in legalese).

You have a chance to respond. The summons and complaint give you a period of time within which you must respond if you choose to contest or argue the lawsuit (usually between 20 and 30 days). Whether or not you file a response is up to you. If you don’t respond, the lender will ask the court for a default judgment and will automatically win the suit. The court will issue a default judgment authorizing the lender to sell your home.

If you do respond, you'll have the opportunity to tell a judge just why you think you have a legal right to keep your house and that foreclosure is not warranted. (To learn more about foreclosure defenses, read Nolo's article Defenses to Foreclosure.) The better your defenses, the longer the process will drag out in court. Even if you win, however, it may be a temporary victory if the lender can fix whatever problem caused it to lose this time.

The court enters a judgment in favor of the lender and a foreclosure sale is held. If the court decides in favor of the lender, it will enter a judgment ordering the sale of your home to satisfy the debt. If no one buys your home at the foreclosure sale, ownership goes to the lender.

Right to redeem. A few states give you some time after the foreclosure auction to redeem the property (to recover ownership of the property by paying off the successful bidder).

You leave voluntarily or get evicted. If you don't leave the property when your legal right to remain in the home ends (which depends on state law), you will receive an official, written notice to leave the property. It's best to move out at this point. Learn more about what happens if you don't leave the home.

To learn more, visit Nolo's Judicial v. Nonjudicial Foreclosure topic page.

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