Stop Ohio Foreclosure

Auction_mart_signThe New Depression in Ohio

O.R.C. §2323.07 outlines the procedure for foreclosure, and the laws controlling it, in Ohio.

  • An Ohio foreclosure–if contested–traditionally took six months or more to complete.
  • The New Depression has caused a glut of foreclosures, and some dockets have a span of a year or longer before the sale of a foreclosed property.
  • As such, there’s usually plenty of time between when a person falls behind on payments and a foreclosure sale.
  • Many Ohio bankruptcy and consumer rights lawyers will work with lenders in that intervening period to modify or adjust the terms of a mortgage to the benefit of the property owner.

They Have to Sue

  • If those efforts at modification fail, or if the owner decides to abandon the property, a lender will file suit in the Common Pleas court of the county where the property is located.
  • The plaintiff also files a notice called “lis pendens,” Latin for “not as dirty as it sounds,” and which notifies the community that the property is subject to a foreclosure.
  • A property owner then has twenty-eight days to file an answer.
  • Should a defendant fail to answer, the county court will enter a “default” judgment, which is something akin to a forfeit, but has all the teeth of a real, hard-won judgment.
  • Otherwise, if properly answered, the suit advances to summary judgment or trial.

The Sale

  • If the lender wins a foreclosure, the court will order the subject property sold at no less than 66% of the appraised value.
  • Lenders must advertise the sale 30 days prior, and must run ads once per week for the three weeks prior to the sale.
  • Ohio’s county Sheriffs sell Ohio’s foreclosed property, usually at the county courthouse.
  • Once the sale is completed, and the Sheriff confirms the sale, and validates there was no flaw in the procedure, the County issues an new deed to the auction winner.
  • At that point, the property owner is no longer the property owner.

Note to Active Duty Soldiers & Families:

Active duty military personnel cannot be foreclosed, and a bankruptcy case filed in Ohio will stop a foreclosure at any stage prior to sale.

Not Over Till It’s Over

  • As a last resort for saving property, Ohio property owners facing foreclosure can “redeem” property, which means if a he can pay off a note prior to sale confirmation by a county court, the property will revest in that property owner.
  • Of course, most in a position to do so would never have gotten into a foreclosure proceeding to begin with, so Ohio foreclosure redemption rights are rarely exercised.

Not Over When It’s Over

  • Debtors still owe the difference between the property’s selling price and the balance on the original loan.
  • Lenders have two years to enforce these “deficiency judgments.”
  • Many people facing deficiency judgments choose to file bankruptcy to eliminate what has become, by that point, a fully dischargeable unsecured, non-priority debt.  If you are in this situation consider a Dayton Ohio based Bankruptcy Attorney.
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