North Carolina Foreclosure Process and Laws


Quick Facts About the North Carolina 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: Yes

Deficiency Judgments Allowed: Varies

Lenders in North Carolina can use the judicial on non-judicial foreclosure process in foreclosing mortgages in default.

Judicial Foreclosure
When no power of sale clause is present in a mortgage, the judicial foreclosure is done. This involves obtaining a court order to foreclose, and the property will be auctioned off to the highest bidder.

Non-Judicial Foreclosure
The non-judicial foreclosure process is used when there is a power of sale clause in the mortgage or deed of trust. This means that the borrower has pre-authorized the sale of the property in case of their default. When this happens, the lender or his representative has the power to sell the property according to the guidelines stated below.

Power of Sale Foreclosure Guidelines
If the mortgage power of sale clause specifies the time, place and date of sale, then these must be followed. But a preliminary hearing must first take place before the foreclosure sale can continue.

If the court determines that a foreclosure sale may take place, the clerk will issue a notice of sale and the following procedures must be followed:

  1. The notice of sale must be sent by first class mail to the borrower at least 20 days before the date of sale. It must also be published in the county newspaper where the property is located, once a week for two consecutive weeks, with the last ad not less than 10 days before the sale. Lastly, another notice must be posted on the courthouse door for 20 days before the foreclosure sale.
  2. The notice must contain the borrower’s and lender’s name, a description of the property, and the time, place and date of sale.
  3. The sale is to take place in the county courthouse where the property is located from 10am-4pm, and sold to the highest bidder at the auction. Upset bids can still be filed to the court clerk 10 days after the sale.
  4. The sale may be postponed by announcing it on the originally scheduled date. The new date and time of sale shall then be posted on the courthouse door.

Lenders may file for a deficiency judgement while borrowers retain the right to redemption.

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.

Greensboro Field Office

Asheville Building
1500 Pinecroft Road, Suite 401

Greensboro, NC 27407-3838

Phone: (336) 547-4000

Fax: (336) 547-4138
TTY: (336) 547-4054

NC Relay: 711 (Voice/TTY)

Jurisdiction: State of North Carolina

Christian T. Stearns
Field Office Director
Office Hours: 8:00 a.m. to 4:30 p.m.

Monday through Friday