Under federal law, the servicer cannot officially start a foreclosure until you are more than 120 days behind on payments, with some exceptions. This 120-day period provides most homeowners with ample opportunity to submit a loss mitigation request to the managing entity. The non-judicial foreclosure process is used when there is a power of sale clause in a mortgage or trust deed. In Virginia, lenders can enforce foreclosure on trust deeds or delinquent mortgages through a judicial or non-judicial foreclosure process.
Under the new law, the notice of foreclosure sale of owner-occupied residential real estate must be mailed at least 60 days before the foreclosure sale. A copy of the foreclosure notice must be attached to the affidavit and both documents must be provided to each potential bidder in the foreclosure sale. The foreclosure sale cannot continue unless the trustee making the foreclosure sale has proof that the foreclosure notice was sent. The regulations for this type of foreclosure process are described below in the Power of Sale Foreclosure Guidelines.
Usually, after the court declares a foreclosure, the property will be auctioned to the highest bidder. The foreclosure court process, which involves filing a lawsuit to obtain a foreclosure court order, is used when the mortgage or trust deed has no selling power. The person submitting the foreclosure notice on an owner-occupied residential property must sign an affidavit stating that the foreclosure notice was sent to the landlord. For foreclosures that do not involve owner-occupied residential real estate, the deadline for notification of subordinate trust deeds remains 30 days.
In addition, in the case of owner-occupied residential real estate, the foreclosure notice must be sent to holders of registered subordinate trust deeds at least 75 days before the proposed sale date.
