Paul Clark
In this Blog we open the conversation with
economic loss caused by the current mortgage
crisis.
North Carolina Foreclosure Laws
North Carolina Foreclosure
Laws: Quick Facts
- Judicial Foreclosure Available: Yes
- Non-Judicial Foreclosure Available: Yes
- Primary Security Instruments: Deed of
Trust, Mortgage
- Timeline: Typically 60 days
- Right of Redemption: Yes
- Deficiency Judgments Allowed: Varies
North Carolina Foreclosure Laws:
lenders may foreclose on deeds of trusts or
mortgages in default using either a judicial or
non-judicial foreclosure process.
North Carolina
Foreclosure Laws: Judicial Foreclosure
The judicial process of foreclosure, which involves
filing a lawsuit to obtain a court order to
foreclose, is used when no power of sale is present
in the mortgage or deed of trust. Generally, after
the court declares a foreclosure, your home will be
auctioned off to the highest bidder.
North Carolina
Foreclosure Laws: Non-Judicial Foreclosure
The non-judicial process of foreclosure is used when
a power of sale clause exists in a mortgage or deed
of trust. A "power of sale" clause is the clause in
a deed of trust or mortgage, in which the borrower
pre-authorizes the sale of property to pay off the
balance on a loan in the event of the their default.
In deeds of trust or mortgages where a power of sale
exists, the power given to the lender to sell the
property may be executed by the lender or their
representative, typically referred to as the
trustee. Regulations for this type of foreclosure
process are outlined below in the "Power of Sale
Foreclosure Guidelines".
North Carolina
Foreclosure Laws: Power of Sale Foreclosure Guidelines
If the deed of trust or mortgage contains a
power of sale clause and specifies the time,
place and terms of sale, then the specified
procedure must be followed. However, in North
Carolina, a preliminary hearing must be held
before a power of sale foreclosure can take
place.
After the preliminary notices have been issued,
the clerk of the court will conduct a hearing to
determine whether or not a foreclosure sale may
take place. If and when the clerk issues a
notice of sale, the foreclosure may proceed as
follows:
A notice of sale must be: 1) mailed
first class mail to the borrower at least
twenty (20) days before the sale; 2)
published in a newspaper of general
circulation in the county where the property
is located once a week for two (2)
successive weeks, with the last ad being
published not less than ten (10) days before
the sale; and 3) posted on the courthouse
door for twenty (20) days prior to the
foreclosure sale.
Said notice must name the borrowers, the
lenders, provide a description of the
property and state the date, time and place
of sale.
The sale must be conducted at the
courthouse in the county where the property
is located between the hours of 10:00 am and
4:00 pm. The property will be sold to the
highest bidder. Upset bids may be filed with
the court clerk for a period of ten (10)
days after the foreclosure sale.
The sale may be postponed by announcing
the need to postpone at the time and place
the regular sale would have taken place. A
notice of the postponement, stating the new
date and time the foreclosure sale will be
held, must be posted on the courthouse door.
Lenders may pursue a deficiency judgment and
borrowers retain the right to redemption.
