Foreclosure Process in Vermont

Vermont

Vermont is a strict foreclosure state.  That means that foreclosures in this state proceed on the premise that the lender owns the home, not the borrower.

So, if the borrower transgresses on any condition in the mortgage before the loan is paid in total, they will lose all right to be in the home.  The lender will take hold of the property and set up the auction.

The first step in this state is; the borrower/homeowner must be served a summons to appear in court and there be apprised of his or her rights in the case.  At this time, the lender can request a summary judgment.  This, if granted, will by pass a trial completely.

If the lender chooses to go for the in court foreclosure, they must first file a complaint in court and receive a decree of sale.  The occasions when this type of foreclosure is required, is when the property includes a dwelling of two units or a building that has less than two units .  The owner must be utilizing this as their principle residence.  Another rule that applies to this form of foreclosure is that the property cannot be sold until after seven months following the granting of the decree of sale.

Vermont allows for out of court foreclosure when, again it is not a 2 unit or less dwelling with owner residing in one of those units as their primary home or farmland.  If these conditions are met, then the lender can sell the place without either a formal foreclosure proceedings or bothering to get decree of sale.

This is how the sale would proceed, at a minimum of thirty days before the advertising of the notice of sale , a letter called the notice of intent to foreclose, must be sent to the home owner by registered mail.  This must be sent to their last known address.  This letter must contain a description of the condition in the mortgage that the borrower has not honored.  It must also explain the lender’s right to accelerate the mortgage (call it due in full)  This letter must state that the homeowner will receive a notice of sale, no sooner than sixty days before the sale date.

At anytime before the sale , the borrower can “buy back” the home and avoid foreclosure by paying the total amount of the mortgage plus attorney’s fees and other lender expenses.

If and when the sale date does arrive, it will be held on the property itself.  Sometimes the court will designate some other location.  The property will then be sold to the highest bidder.  Anyone, including the lender, may bid.  If there is not enough money from the winning bid, to pay off the amount owed, then the lender has the right to continue to pursue the borrower for the additional money.  They will do this through a law suit.

In Virginia, if the mortgage was initiated after 1968, the home owner has six months to regain ownership of the property.  If the home has a mortgage that was entered into before 1968, then the home owner can “buy it back” for a full 12 months after the sale.

The cost of the option to the home owner is the highest or winning bid amount at the auction plus interest.

Integrity 1st Consulting is your Foreclosure  ebook specialist- Kathy Swift