Understanding the Connecticut foreclosure process is essential if you are to mount a defense to keep your home. Knowing what to expect will help you avoid being taken advantage of by banks who may try underhanded tactics to take your home from you. While it is true that banks generally want money rather than the property, they will do whatever it takes to get what they feel rightfully belongs to them.
Connecticut allows for three types of foreclosures to take place. Judicial foreclosure is the most common process where a judge decides if the debt is owed and what happens to the home. Strict foreclosure happens when there is no equity in the home. The lender files suit for the back payments and the courts gives the borrower a set amount of time to get caught up. If the loan is not brought current then ownership of the property reverts to the bank. Foreclosure by Sale is when the lender sells the property without the benefit of court supervision.
Foreclosure by the bank will start with a notice from the lender advising you that you have thirty days to bring your loan current before they will file paper with the court. If payment is not made within this time period, they go to the next step.
To determine who all the lien holders are on the account, a title search will be conducted. All lien holders, generally whoever is listed on the loan and other financial companies with interest in the house will receive a summons notifying them that the lender is about to foreclose on the home.
You must file a mediation certificate within fifteen days of receiving the summons. It is required that all parties participate in mediation if you are eligible. If you own a single to multiple (up to four) family property and you can answer yes to the questions on the mediation form then you and the bank will go into mediation.
Although you will work with the lender through mediation to renegotiate the loan terms, the lender will continue to file papers with the court. These include a motion for a default judgment due to failure to appear which requests the judge to decide in the lender’s favor should you not appear, a motion for default judgment for failure to plead against anyone who has not filed and Answer motion within two days of receiving court summons and a motion for a summary judgment which asks the court to decide that you do owe the lender money.
One important thing to note is that while the bank may continue to file motions with the court, they will not receive a judgment regarding the case until mediation ends. The time allotted for mediation is sixty days although you may petition the court for more time. If you want to stay in your home, then mediation is the best chance you have to getting the bank to modify the terms of your loan so it is important to participate.
The lender will stop foreclosure proceedings if you are able to successfully negotiate with each other during meditation. Otherwise, it will go to Judgment where the court will decide if to give the house to the lender or to order a sale of the home. The decision is mostly dependent on the home’s value in relation to what is owed on the house note.
The Connecticut foreclosure proceedings are pretty straightforward. Until you are actually evicted from your house, you are afforded many opportunities to put a stop to the court case. Use every tool you have at your disposal to successfully keep your home.