For homeowners facing foreclosure in Delaware, the following is a summary of the state’s foreclosure laws:
Foreclosures in Delaware can be judicial, meaning the bank must file a lawsuit in court in order to foreclose.
Nonjudicial foreclosures are not allowed in Delaware.
The important parts of Delaware’s foreclosure laws are summarized below. You can find more detailed articles on various aspects of Delaware’s foreclosure law in Nolo’s Delaware Foreclosure Law Center.
Most Common Type of Foreclosure Procedure in Delaware
Delaware foreclosures are judicial, which means the lender must sue the homeowner in court in order to foreclose.
Notice of the Foreclosure
Delaware law requires the following notices.
Before beginning a foreclose, the bank must mail the homeowner a 45-day notice of intent to foreclose if the home is in a residential property that is one to four units.
In Delaware, the bank must give the homeowner a chance to apply for a foreclosure alternative under federal loss mitigation programs such as the Home Affordable Modification Program (HAMP) and the Home Affordable Foreclosure Alternatives Program (HAFA). This requires the notice of intent to include a list of the loss mitigation programs available and instructions on how to apply for help.
To officially initiate a foreclosure, the bank must file a lawsuit and provide notice of the suit to the homeowner by serving him or her with a summons and complaint. The homeowner will have 20 days to respond. If the homeowner does not respond, the court will issue an order allowing the bank to sell the home.
The bank must also give eligible homeowners a notice about Delaware’s Automatic Residential Mortgage Foreclosure Mediation Program.
Under Delaware law, the homeowner should be informed of the sale ten days before the day of sale. The notice of sale must also be publicly posted and published in two local newspapers for two weeks before the sale.
Reinstatement and Redemption
Delaware law does not allow the homeowner to reinstate before the sale, yet the terms of the mortgage contract may let the homeowner reinstate or the bank may approve a reinstatement.
Though there is no statutory post-foreclosure right to redeem in Delaware, the homeowner has up until the court approves the foreclosure sale to pay off the full amount of the outstanding debt and maintain the home.
Delaware Foreclosure Protections
Delaware law provides protections in accordance with the federal Service Members Civil Relief Act.
Delaware has a special program, the Delaware Emergency Mortgage Assistance Program (DEMAP), which offers financial assistance to homeowners to prevent the foreclosure of a primary residence. A homeowner may be eligible for the program if they have had a loss of 15% or more of their income due to either:
- involuntary loss of employment or reduction in hours, or
- inability to work or reduction in hours due to an injury or illness (including the injury or illness of an immediate family member for whom they are the primary caregiver).
In Delaware, the bank may receive a deficiency judgment by filing a separate lawsuit after the foreclosure.
If the former homeowners don’t leave the home after a Delaware foreclosure, the bank may evict as a foreclosure action. For information regarding how to avoid foreclosure in Delaware, visit HUD.gov.