Foreclosures in South Carolina are judicial, which means a court handles the process. On May 6, 2020, the state supreme court issued an administrative order (Order No. 2020-05-06-01) requiring a foreclosing party to file a specific form certifying its compliance with the Coronavirus Aid, Relief, and Economic Security (CARES) Act in court as part of the official foreclosure procedures in South Carolina.
If you're facing a foreclosure in South Carolina, you might be able to defeat or stall the process if the foreclosing party uses a defective certification, or didn’t file one at all, in its lawsuit against you.
The CARES Act, as well as a previous state order (Order No. 2020-03-18-01), imposed a foreclosure moratorium—a temporary suspension of foreclosure procedures—when the coronavirus outbreak started. The federal moratorium ends on May 17, 2020, and the state moratorium ends on May 15, 2020.
The South Carolina Supreme Court's most recent order requires any party pursuing an eviction or foreclosure in a trial court to submit to the court a signed, original Certification of Compliance with the CARES Act.
Here are the new rules:
If the foreclosing party doesn’t file this certification with the court, the foreclosure must terminate with no further action.
Also, master-in-equity courts can’t hold a foreclosure sale, or issue a judgment of foreclosure, writ of assistance, or writ of ejectment in a foreclosure action until the foreclosing party complies with this order. Magistrate courts can’t issue a writ or warrant of ejectment in an eviction action until the party pursuing the eviction has filed the certification form. (In some South Carolina counties, foreclosures go through an equity court judge, called a master-in-equity, or through a special referee.)
The certification form requires the party seeking foreclosure to verify in writing that the property is not subject to the restrictions, limitations, and requirements of the CARES Act.
Under the CARES Act, homeowners with a federally backed mortgage loan can get a forbearance. So, the approved certification form requires the foreclosing party to state that either:
The certification requires the foreclosing party to verify, subject to punishment by contempt, to the truth of the statements in the document. The information in the form must be true, accurate, and adequately supported by file documentation.
You could potentially challenge a foreclosure if:
If the foreclosing party says that you don’t have a federally backed mortgage loan, the certification also has to identify which database or the other information was used to make this determination. You should review this information on the form as well, to make sure the data is correct. If not, you can argue that the document is flawed.
You might also be able to challenge the foreclosure if you can show that the certification was robosigned. (To learn more about robosigning as a defense to foreclosure, read Robosigning in Foreclosures: What Homeowners Can Do About It.)
If you're facing foreclosure and think that the foreclosing party failed to file a CARES Act form, or filed a defective certification, consider talking to a qualified attorney who can advise you about what to do in your circumstances.
Any given foreclosure or legal situation has many potential claims and defenses. A local lawyer or a legal aid organization can help you explore all possible options that might be available in your particular situation.
Effective date: May 6, 2020