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Explaining the process of a Georgia home foreclosure

| January 17, 2020

When someone is unable to continue making their mortgage payments, the lender can force the sale of the home through a Georgia home foreclosure. Each state has different laws governing home foreclosures. In Georgia, the home-foreclosure process is relatively a speedy one, and can happen as quickly as a few months.

The foreclosure process begins when the homeowner misses a payment. Under federal law, lenders must wait for a homeowner to be delinquent for at least 120 days before beginning the foreclosure process. During this period, homeowners can work with their lenders to avoid the foreclosure in a process called “loss mitigation.”

While lenders must wait 120 days to formally begin the foreclosure process, lenders must follow other rules. For example, a lender must inform a homeowner within 36 days of a missed payment, and each 36 days thereafter. Additionally, lenders must inform homeowners about their loss mitigation options no more than 45 days after a missed payment.

Most Georgia security deeds contain a clause allowing the lender to demand the entirety of the loan’s balance if the borrower defaults on the loan. This is called an acceleration clause. Before the federally-mandated 120 days is up, a lender must send a homeowner a breach letter, explaining that the homeowner has violated the mortgage agreement. A breach letter must also explain how the borrower can bring the loan back into compliance and the date by which that must be done. Typically, the lender will send this letter after 90 days of delinquency, stating that the borrower has 30 days to cure the default, at which point the lender will trigger the acceleration clause and sell the property.

Once the 120-day period is up, the lender must provide the following notices:

  • 30-day notice of intent to foreclose
  • Publication of the notice of sale
  • Reinstatement before sale

If the default is not cured, the home will go to a foreclosure sale, which are held at the county courthouse on the first Tuesday of the month. The property will be sold to the highest bidder, who may then sue the original homeowner for a deficiency judgment for any amounts owed under the original mortgage.

Unlike other states, Georgia does not have a redemption period, meaning that once a home has been foreclosed, it cannot be redeemed. Once the home is sold, the former homeowner no longer has a right to occupy the property. If, after a foreclosure, a former homeowner does not leave, the new owner can either offer them a cash payment to leave or initiate an eviction proceeding.

If you are considering filing for bankruptcy, contact the knowledgeable attorneys at the Georgia bankruptcy law firm, Morgan & Morgan, P.C. To learn more, call (706) 752-7089 to schedule a free consultation today.

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