Virginia Foreclosure Laws

Virginia foreclosure can be accomplished either by out-of-court or judicial method. Typical timeline for non-judicial foreclosure is about 2 months. However, there are other considerations to note such as when the borrower challenges the foreclosure, files bankruptcy, or seeks delays. In either an in-court or non-judicial setting, the borrower has the power to stop the foreclosure at any point up until the date of sale. To do this, the borrower needs to pay off the default loan to the lender.

Judicial And Non-Judicial Foreclosure Information

Since Virginia foreclosure laws allows for either judicial or non-judicial procedure, the presence or absence of a Power of Sale provision determines the type of foreclosure to use. When signed by the borrower, this provision empowers the lender to foreclose a property without obtaining a court order to satisfy debt. This type of foreclosure is non-judicial. On the other hand, judicial foreclosure occurs when a loan document do not have a Power of Sale clause and should be administered in court.

To initiate a judicial foreclosure, the lender files a complaint against the defaulted borrower in court. The court has the final judgment on this matter and if there is sufficient evidence against the borrower, such as payment defaults, a foreclosure sale will be scheduled in order to sell the property and satisfy debt.

Non-judicial foreclosures are commonly used. To commence an out-of-court foreclosure, the lender should send a Notice of Default to the defaulted borrower. This will inform the borrower of the debt he/she owed and the impending foreclosure action directed to the property in question. The borrower is expected to make a payment of the amount owed within 30 days of receiving the Notice. Failure to do so allows the lender to schedule a public auction.

An after-sale statutory right of redemption is not applicable or supported by the state’s foreclosure laws. The sale is considered as final; hence, the person whose property been foreclosed can no longer regain ownership of the said property.

On the other hand, a lender may claim for deficiency judgment when the income of the auction is less than the sum of the loan. When this action is bestowed upon the lender, the borrower is asked to pay for the difference between amount of the property sold at the foreclosure auction and the amount of the original loan to the lender.

The lender’s trustee conducts the foreclosure sale. During the sale which is in the form of a public auction the property is auctioned off to the highest bidder. Once payment is secured, property ownership will be transferred to the winning bidder.

Notice Of Sale Virginia

Under Virginia foreclosure laws, the Notice of Sale should be published in a local newspaper. Also, the Notice should be sent to the homeowner in no less than 14 days before the date of the auction. The auction may not be postponed. However, it may be canceled. If this happens, the foreclosure process must begin anew.