After the Hearing outline:
When will my home be sold?
In South Carolina, the foreclosure sale date must be ordered by a judge. The foreclosure sale is a public auction, and the home will be sold to the highest bidder. After the Court issues a Judgment of Foreclosure, a Notice of Sale will be published in a local newspaper for the three weeks leading up to the sale date.
Generally, foreclosure sales are held once a month, most commonly on the first Monday of the month, but the dates can vary by county. You can check with the local Master in Equity’s office or Clerk of Court for your county to find out when foreclosure sales are held in that county.
It is not possible to say when a house will be sold early in the case, because a judge must set the sale date. If you do nothing after you are served with the Summons and Complaint, you likely will have at least four months from the date you are served. If you request Foreclosure Intervention or contest the foreclosure by asserting legal defenses you have, this can extend the length of the foreclosure process. Know that the police will not show up unannounced at your door to throw you out if you have been served with the Summons and Complaint within the last 30 days.
Once the foreclosure sale is final, you will no longer be the owner of the house. When the sale becomes final depends on whether or not the mortgage company has asked for a Deficiency Judgment (see below for more details on what that is). If the deficiency was waived, the sale is final as of the date of the auction. If a deficiency has been requested, then the sale does not end on the date of the original auction. The bidding will remain open for thirty days, and the highest bidder at the end of that time will win the auction.
Once the house is sold at the foreclosure auction, will I owe anything else?
This will depend on whether the mortgage company has demanded a Deficiency Judgment against you. If the winning bid at the foreclosure sale is less than the balance on your mortgage, the mortgage company can hold you responsible for the difference. The court can issue a Deficiency Judgment against you for that difference.
A Deficiency Judgment lasts for ten years. It also acts a lien against any real estate you own in the county where it is recorded. The mortgage company can record it in other counties to place liens on other real estate that you own as well. In South Carolina, a Deficiency Judgment cannot be collected through garnishment or through criminal law. The mortgage company can ask the Sheriff’s department to “attach,” or seize, other personal property you own, and sell it at public auction to pay towards the judgment. However, South Carolina does offer some exemptions which allow you to protect up to a certain value of specific types of assets that cannot be taken and sold to pay a judgment. The specific values of these exemptions change from year to year.
As noted above, sometimes the mortgage company will waive that deficiency judgment, but that is their decision. If they do so, they have given up their right to collect a money judgment against you if the home sells for less than you owe.
If the mortgage company cancels the remaining debt, you could end up owning a tax debt. A mortgage company can in some circumstances tell the IRS that it has cancelled a debt that you owe. The mortgage company is supposed to send you a 1099-C form if it cancels your debt. This is how you know that the IRS will consider the waived debt to be income to you. The problem is that the mortgage company might send the 1099-C form to the house you just lost, so you might not receive it if you did not have your mail forwarded. It is also a good idea to check with your mortgage company or the IRS in the tax year following your foreclosure to see if a 1099-C was issued.
You are allowed to challenge a Deficiency Judgment if you believe that the foreclosure sale price was less than the home’s actual value. In South Carolina, you have what are called “appraisal rights.” These rights are found in S.C. Code Sections 29-3-680 through 29-3-770. If you follow the procedures in those statutes, you can have the house appraised after the Foreclosure sale and to have the appraised value substituted for the highest auction bid when calculating the amount of the Deficiency. For example, if the house sells at auction for $30,000 leaving a Deficiency, you timely exercise your appraisal rights, and the house appraises for $50,000, your Deficiency will be reduced by up to $20,000 (the difference between the appraised value and the winning auction bid). You may want to contact an attorney to assist you with this.
Sometimes, the home sells for more than you owe on it. If this occurs, the court will hold a hearing to determine who is entitled to those surplus funds.
When do I have to move?
Once you are no longer the legal owner, the new buyer has a legal right to put you out. The buyer might be the mortgage company, or it might someone else. Once the sale becomes final, the buyer first needs to pay the bid (unless the mortgage company was the high bidder using only a “credit bid” up to what was owed on the mortgage). The judge will then execute a deed to the buyer, which will be recorded. This usually occurs within 10-14 days after the sale.
If you do not vacate the property timely, one of two things can happen. Whoever buys the house may initiate another legal process to have you evicted. This takes much less time than the foreclosure, usually taking only a month or so. Or, depending on how the Order and Judgment of Foreclosure reads, it may empower the County Sheriff to put the purchaser into possession of the property without the need for a separate eviction. In that case, the purchaser can ask the Master in Equity or Special Referee to issue a “Writ of Assistance” to direct the Sheriff’s department to do so.
If you know you are going to need additional time after the foreclosure sale to vacate the property, it is best to file a written request with the court asking for more time. You will need to send a copy of that written request to the mortgage company’s attorney. The court will then hold a hearing to determine how much more time, if any, is reasonable.
Time frame for appeals
You have 30 days from the date you received written notice of the Judgment of Foreclosure to file an appeal. This deadline is strict. Appeals are outside the scope of the classroom. It is recommended that you contact an attorney.
What about filing bankruptcy?
In some circumstances, a bankruptcy can be filed to stop the foreclosure sale and save the home. It may allow the debtor to keep the home by agreeing to repay the debt over time, usually three to five years. Filing bankruptcy is outside the scope of the classroom, so it is recommended that you contact an attorney. If you are interested in filing bankruptcy to save the home, please note that you would need to file before the foreclosure sale.