Summary of Maryland Foreclosure Laws
If you’re behind on your mortgage, facing foreclosure, and need to know more about the foreclosure process in Maryland, the first thing you should know is that you’re not alone.
The first step is to take a deep breath…
Thousands of homeowners find themselves in your very shoes each year – often through no fault of their own. Life events, changes in employment, medical emergencies, or a myriad of other factors may have contributed. The late payments may have snowballed, and now you’re receiving threatening calls from your lender and have no idea what to do. The good news is that Maryland foreclosure laws are pretty straight-forward, and the steps that a lender must take to foreclose on your home in Maryland are outlined in state law. By knowing and understanding the Maryland foreclosure process you can gain a peace of mind, know exactly where you stand in the process, and even stop foreclosure in Maryland.
There are several ways for a lender to foreclose on your home in Maryland
Maryland’s foreclosure process can happen one of three different ways — judicial foreclosure, assent to decree foreclosure, or non-judicial foreclosure. A judicial foreclosure means that the lender must file a complaint against the borrower and obtain a decree of sale from a court before foreclosure proceedings can begin. The court must provide a reasonable time within which payment may be made and can order that if payment is not made within the time, the property must be sold to satisfy the debt.
An assent to decree foreclosure occurs when there is a specific provision in your mortgage document that says the property must be sold to satisfy debt whenever a specific default on the mortgage occurs. Lenders still must file a complaint to foreclose in Maryland when using an assent to decree foreclosure.
A non-judicial foreclosure is like an assent to decree foreclosure in the sense that a power of sale clause exists in the mortgage you signed. If your mortgage has a power of sale clause, then you – the signer – have pre-authorized the lender to sale the property to pay off the balance of the loan in the event you default on your mortgage. In this case, the lender still must file a complaint to foreclose in court as well. However, it is not necessary for a hearing to be held.
The typical Maryland foreclosure timeline is 90 days.
From the time that a lender initially files a complaint in court to the time that a foreclosure is actually carried out typically takes about 90 days in Maryland. The lender has to do everything by the books and jump through a lot of legal hurdles to legally foreclose on your home. And remember – the 90 days is from the time they officially file the initial complaint with all corresponding paperwork in court. If they haven’t done that, then you certainly have longer than 90 days to try to catch up on payments, make an alternative arrangement with your lender, and stop the foreclosure process in Maryland.
Lenders have the ability to file for a deficiency judgement.
Under Maryland foreclosure laws, a lander has a period of three years to file for a deficiency judgement. This means that, even after a home has been foreclosed on, they can try to recoup the balance of the loan in default that wasn’t covered by proceeds from the sale of the property. The amount of the deficiency judgement is limited to the unpaid amount left over after the foreclosure sale proceeds have been applied however.
There are ways to stop the foreclosure process in Maryland and save your home from foreclosure.
Homeowners who are faced with the scary prospects of foreclosure in Maryland do have options. These range from legal options to working out an arrangement or alternative payment plan with your lender. National Home Team has helped plenty of homeowners avoid foreclosure in Maryland, and we’re likely able to help you stop the Maryland foreclosure process. If you’d like a free consultation about your options and want to know more about the Maryland foreclosure process, let’s set up a time to chat.
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