For homeowners facing foreclosure in North Carolina, the following is a summary of the state’s foreclosure laws:
Foreclosures in North Carolina can be judicial, meaning the bank must file a lawsuit in court in order to foreclose.
Foreclosures in North Carolina can also be nonjudicial but a court must confirm the sale.
North Carolina law requires four foreclosure notices:
- At least 45 days before starting the foreclosure, the bank must send the homeowner a foreclosure notice about the amount due and resources that are available to avoid foreclosure.
- The bank must send a notice of default to the homeowner 30 days before the date of the notice of hearing.
- To officially start the foreclosure process, the bank will file a notice of hearing with the court clerk. Then, the bank will serve a notice of hearing to the homeowner at least ten days before the hearing takes place or 20 days if served by mail.
- The clerk can postpone the foreclosure proceedings for up to 60 days if the homeowner and bank are able resolve the matter without a foreclosure.
- At least 20 days before the sale, the bank will mail a notice of sale to the homeowner and post the notice in a visible public place. It must also publish the foreclosure notice in a local newspaper for two weeks before the foreclosure sale.
North Carolina Foreclosure Protections
North Carolina law also prohibits a nonjudicial foreclosure during or within 90 days of a homeowner’s period of military service if the homeowner took out the mortgage loan before going on active duty.
Reinstatement and Redemption
North Carolina law does not allow the homeowner with the right to reinstate before the foreclosure sale. However, the terms of the mortgage loan may allow the homeowner to reinstate or the bank might agree to let you reinstate, even if there is no such specific provision in the mortgage contract.
In North Carolina, the homeowner can redeem the home during the 10-day upset bid period after the foreclosure sale.
In North Carolina, the bank can sometimes be awarded a deficiency judgment after a nonjudicial foreclosure, except after a nonjudicial foreclosure of seller financed mortgage. The bank can also be excluded from requesting a deficiency judgment when the mortgage loan is a Pick-a-Payment or Option ARM loan, or certain rate spread home loans that secure the homeowner’s principal residence.
If the foreclosed homeowner doesn’t leave after the foreclosure, the buyer has to give the former homeowner a 10-day notice to leave before going to court clerk to get an order for possession. For information regarding how to avoid foreclosure in North Carolina, visit HUD.gov.