For homeowners facing foreclosure in Tennessee, the following is a summary of the state’s foreclosure laws:
Foreclosures in Tennessee can be judicial, meaning the bank must file a lawsuit in court in order to foreclose.
Foreclosures in Tennessee can also be nonjudicial but a court must confirm the sale.
Tennessee law requires one foreclosure notice:
In Tennessee, the foreclosing party must:
Publish a notice of sale in a local newspaper three different times, with the first publication occurring at least 20 days before the sale, or post the notice of sale in several public places 30 days before the sale. On or before the date of the first publication, the trustee must send the homeowner a copy of the notice of sale.
Tennessee Foreclosure Protections
Tennessee law provides protections in accordance with the federal Service Members Civil Relief Act.
Tennessee law also provides protections to members of the reserves or the Tennessee National Guard. Under Tennessee law, if a member of the reserves or the Tennessee national guard entered into a mortgage or deed of trust to buy a home, and the service member is then called into active military service outside the United States, the bank cannot initiate the foreclosure process until 90 days after the service member returns to Tennessee.
In the case of a high-cost home loan, the bank must send a notice of right to cure to the homeowner at least 30 days before publishing the notice of foreclosure.
Reinstatement and Redemption
Tennessee law does not allow a homeowner with a right to cure the default and reinstate the mortgage loan before the foreclosure sale, unless the loan is a high-cost home loan, though the mortgage loan contract itself may provide this right.
In the case of a high-cost home loan, the homeowner can cure the default at any time prior to three business days before the foreclosure sale. The bank must send a notice before publishing the notice of foreclosure, or starting a judicial foreclosure, that allows the homeowner 30 days to reinstate. A homeowner’s right to cure the default prior to initiating a foreclosure process is only allowed once in any 12-month period.
In Tennessee, a homeowner has two years after the foreclosure to redeem the home unless the mortgage or deed of trust that was signed when taking out the loan specifically waives the right of redemption.
There is no anti-deficiency law in Tennessee, which means the bank can file a separate lawsuit after the foreclosure sale to be granted a deficiency judgment against the homeowner.
In Tennessee, once a nonjudicial foreclosure is over, the new homeowner can begin the eviction process. For information regarding how to avoid foreclosure in Tennessee, visit HUD.gov.