THE MORTGAGE FORECLOSURE PROCESS IN GEORGIA
Georgia Security Deeds often contain a clause that states that if your loan is in default, the lender can accelerate the loan and proceed with foreclosure. This acceleration clause in the Security Deed permits the lender to demand that the entire balance of the loan be repaid in order to avoid foreclosure.
Under Georgia law, a 30 days’ notice prior to the scheduled foreclosure sale is required. This notice must be sent to a homeowner from a lender before the mortgage lender can foreclose. The law also requires that the notice letter be sent via certified mail. The notice letter must also include the address, name, and telephone number of the entity or individual who has the full authority to amend, negotiate, and modify the terms of the mortgage with the debtor.
Most residential foreclosures in Georgia are non-judicial, which means the lender can foreclose without going to court so long as the Security Deed authorizes it in a ‘power of sale’ clause. The foreclosure sale must be advertised in the official legal newspaper in the county where the property is located once a week for four consecutive weeks prior to the scheduled sale date.
Generally, there is no statutory right in Georgia to reinstate the loan prior to the sale. However, most Security Deeds provide the borrower the right to reinstate the loan after acceleration and before the foreclosure sale. Some lenders will allow the loan to be re-instated right up to the time of the foreclosure sale. The cost to re-instate a loan is generally comprised of past-due mortgage payments, plus accrued interest and Attorney fees.
Foreclosure sales are generally handled by a Foreclosing Attorney. This Foreclosing Attorney usually acts as the lender’s agent. You may contact this Foreclosing Attorney to request an official re-instatement figure or a full pay-off figure.
Foreclosure sales are held at the county courthouse in the county where the property is located on the first Tuesday of the month (unless that day is New Year’s Day or the 4th of July, in which case foreclosures are held on the Wednesday of that week) between 10:00 A.M. and 4:00 P.M. Investors bid on the property, and it is sold to the highest bidder. Under certain circumstances, the lender may bid on the property.
When a lender forecloses on a mortgage, and the total debt owed by the borrower to the lender exceeds the foreclosure sale price. The difference between the sale price and the total debt is called a “deficiency.” In a case where there is a deficiency, the lender can seek a personal judgment against the debtor to recover the deficiency. Generally, once the lender gets a deficiency judgment, the lender may collect this amount from the borrower. Therefore, in this case, a homeowner may lose his or her home and still owe the lender.
In Georgia, once a home has been sold at a foreclosure sale it cannot be redeemed. (Some other states allow a homeowner to reclaim their property after a foreclosure sale by paying off the total debt, including the principal balance, plus certain additional costs and interest).
Following a foreclosure sale, the foreclosed owner no longer owns the property and must vacate the property. If the foreclosed owner doesn’t vacate the property following the foreclosure sale, the new owner can file a dispossessory procedure (eviction) to evict them (and other occupants) from the home.