If you’re a homeowner in Idaho and are behind in your mortgage payments, it's a good idea to learn about how a foreclosure works and find out your rights. To learn about each step in an Idaho foreclosure and get information about both federal laws and state laws that protect you during the process, read on.
In most cases, federal law prohibits the servicer (on behalf of the loan owner) from beginning a foreclosure until the borrower is over 120 days delinquent on the loan. (12 C.F.R. § 1024.41). (To learn more about the federal law that delays the beginning of a foreclosure for 120 days, see How Soon Can Foreclosure Begin?)
Also, federal law generally requires servicers to work with borrowers who are having trouble making their monthly payments in a "loss mitigation" process to try to avoid a foreclosure. (12 C.F.R. § 1024.41).
In Idaho, most residential foreclosures are nonjudicial, which means the foreclosure happens without court supervision. Here’s how the process generally works:
To officially start a foreclosure in Idaho, the trustee will record a notice of default (NOD) in the county recorder’s office and then sends a copy to you (the homeowner). (Idaho Code Ann. § 45-1505.) After the NOD is recorded, the trustee also has to mail you a notice of sale at least 120 days before the sale, which can be sent at the same time as the NOD. (Idaho Code Ann. § 45-1506.)
Furthermore, the trustee has to attempt (three times at least 30 days before the sale) to personally serve the notice of sale to an adult occupant living at the property and post the notice there. But if personal service is made upon an adult occupant and a copy of the notice is posted, then no further attempt at personal service and no further posting is required. Also, posting the notice isn’t required if the adult occupant who was personally served is a person to whom the notice of sale was required to be mailed—like the homeowner—and the notice was mailed. (Idaho Code Ann. § 45-1506.)
The trustee also has to publish the notice of sale in a newspaper once a week for four weeks. (Idaho Code Ann. § 45-1506.)
If the borrower lives in the home as a primary residence, the lender has to provide information about how to request a loan modification—along with a form to make the request—with the NOD.
The lender determines if the property is a borrower’s primary residence by running a search in the county assessor's tax rolls to see if a current homeowner's property tax exemption exists for the property. If one is in place, the property is considered the borrower's primary residence.
If you apply for a modification, the lender has to approve or reject your application within 45 days after the lender receives the form. The sale can’t take place until the lender responds to the application. (Idaho Code Ann. § 45-1506C,)
Under Idaho law, you get the right to prevent the foreclosure by “reinstating” your loan up to 115 days after the recording date of the NOD. To reinstate, you have to pay all missed payments, fees, and costs in one lump sum. (Idaho Code Ann. § 45-1506).
Some states have a law that allows a foreclosed homeowner to “redeem” (buy back) the home after the foreclosure sale. Idaho law doesn’t provide a post-sale redemption period after a nonjudicial foreclosure. (Idaho Code Ann. § 45-1508.) (If you think you will lose your home to foreclosure, read When Do You Have to Leave Your Home When It’s in Foreclosure?)
If the total mortgage debt is more than the foreclosure sale price, the difference is called a “deficiency.” Some states allow the lender to get a personal judgment (called a “deficiency judgment”) against the borrower for this amount.
In Idaho, the foreclosing party may file a lawsuit to get a deficiency judgment after a nonjudicial foreclosure. The deficiency judgment will be:
The lender has to file the lawsuit within three months after the sale. (Idaho Code Ann. § 45-1512.)
While federal and state laws establish a structured foreclosure process, mistakes are common. If you think your lender or servicer has violated the law or you want to find out about different ways to fight a foreclosure, consider contacting a local foreclosure attorney. It’s also a good idea to contact a HUD-approved housing counselor if you want to learn about different loss mitigation options.