Virginia Foreclosure Process and Laws
Quick Facts About the Virginia Foreclosure Process
Judicial Foreclosure Available: Yes
Non-Judicial Foreclosure Available: Yes
Primary Security Instruments: Deed of Trust, Mortgage
Timeline: Typically 60 days
Right of Redemption: Varies
Deficiency Judgments Allowed: Yes
Lenders in Virginia may foreclose on deeds of trust and mortgages in default using a judicial on non-judicial process.
When no power of sale is present in a mortgage, the judicial foreclosure process is done by filing a lawsuit to obtain a court order to foreclose. When this happens, the property can then be auctioned off to the highest bidder.
The borrower has 240 days from the date of sale to redeem the property by paying the amount for which it was sold plus 6% interest.
When a power of sale clause exists in a mortgage, the non-judicial process of foreclosure is used. The power of sale means that the borrower has pre-authorized the sale of the property to pay off the remaining balance in the event of their default. The lender has the power to sell the property, or it can also be executed by a representative called a trustee. The sale must be done following the “Power of Sale Foreclosure Guidelines.”
Power of Sale Foreclosure Guidelines
- If the deed of trust specifies the terms of sale, these must be followed but additional requirements must be followed. Ads must be published once a day for three days, which can be consecutive. On the other hand, if no specifications about advertising is indicated, the ad must be published once a week for four consecutive weeks. If near a city, an ad on five different days, which can be consecutive is sufficient.
A copy of this ad must also be sent to the borrower at least 14 days before the foreclosure sale.
- The foreclosure sale ad must contain all the pertinent information regarding the sale, such as a description of the property, its address, time and place of sale, names of the trustee and phine number to contact.
The borrower may cure the default and stop the sale at any time before the sale by paying the lien debt, costs and atorney’s fees.
- The sale must be made no earlier than 8 days before the first ad is published, and no later than 30 days after the last ad is published. Anyone can bid on the auction except for the trustee, and it can be done by submitting a written one-price bid. Any bidder may inspect the written bids, and the trustee may require bidders to place a cash deposit of 10% of the price, or a higher or lower amount depending on what the deed of trust specifies.
A sale may be postponed but must be advertised the sameway the original sale was advertised.
- Proceeds of the sale will go to the expenses executing the trust, discharge to all taxes and other costs with priority over the lien of deed of trust, discharge in order of priority to the remaining debts and obligations, and the rest will go to the borrower.
Lenders can obtain deficiency judgements without limits in Virginia.
Foreclosure Avoidance Counseling
HUD-approved housing counseling agencies are available to provide you with the information and assistance you need to avoid foreclosure. As part of President Obama’s comprehensive Homeowner Affordability and Stability Plan (HASP), you may be eligible for a special Making Home Affordable loan modification or refinance, to reduce your monthly payments and help you keep your home.
If you need help understanding the Making Home Affordable programs, you can use this search tool to find a counseling agency in your area that will provide you with free foreclosure prevention services. If you are eligible for the loan modification or refinance program, the counselor will work with you to compile an intake package for your servicer.
Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the Federal Government. These agencies are funded, in part, by HUD and NeighborWorks® America. There is no need to pay a private company for these services.
Richmond Field Office
600 East Broad Street, Third Floor
Richmond, VA 23219
Phone: (800) 842-2610
Fax: (804) 822-4984
TTY: (804) 771-2038
Jurisdiction: State of Virginia (Except as noted below under Washington, DC)
Acting Field Office Director
Office Hours: 8:00 a.m. to 4:30 p.m.
Monday through Friday
District of Columbia Field Office
820 First Street, NE, Suite 300
Washington D.C., 20002
Phone: (202) 275-9200
Fax: (202) 275-6381
TDY: (202) 275-6388
Jurisdiction: Washington, DC; City of Alexandria, VA; Fairfax County, VA; Arlington County, VA; Prince William County, VA; Loudoun County, VA; Montgomery County, MD and Prince George’s County, MD.
John E. Hall
Field Office Director
Office Hours: 8:00 AM to 4:30 PM
Monday through Friday