A foreclosure typically means losing a house due to a defaulted mortgage. But if you are in the middle of a foreclosure sale, a foreclosure can occur in different ways. In some states, a non-judicial foreclosure is allowed in which an escrow company can conduct a sale automatically. But in many cases, a court ruling is needed for the foreclosure. Although the court considers the ruling, it is possible for a motion to withdraw the foreclosure sale to be made.
In a judicial foreclosure, the court sets a foreclosure date and holds the sale, usually at the courthouse or at the home itself. Interested buyers can attend and bid on the property as long as their bids cover the necessary amount to pay off the loan. If the auction fails because there are no bidders, then the home is granted to the lender and sold on the open market. However, there is usually a period of one to three months between the ruling and the foreclosure sale, which provides time to file a motion of withdrawal.
Lender Request to Withdraw
Lenders may request to withdraw the foreclosure. Since they filed for foreclosure in the first place, lenders may find the withdrawal process easier than other parties, although they still must pay the court fees for the process. This type of motion to withdraw occurs when a borrower manages to gather enough money to fully pay off the loan, thus settling the debt. There is then no further grounds for the foreclosure and the lender withdraws it.
Withdraw and Delay
Lenders may withdraw foreclosure sale plans for other reasons as well. For example, if a lender believes that a borrower may make a payment in the future or if the borrower is trying to work out an alternative, such as a short sale or deed in lieu, then the lender will want more time. In this case, the lender may file a motion to withdraw the current sale date and delay it for additional months.
Attorneys and Motion to Withdraw
Borrowers may also be able to file a motion to withdraw the foreclosure sale, typically through the aid of a property attorney. This can only occur under certain circumstances involving the legality of the foreclosure. If the foreclosure does not follow the required standards, the borrower may have grounds to file for a withdrawal and dismissal of the case.
- Massaschusetts Collectors and Treasurer's Association: MCTA Treasurer’s Manual
- U.S. Department of Housing and Urban Development: Foreclosure Process
- Connecticut Judicial Branch: Frequently Asked Questions About E-Filing
- Mark Z Properties: 10 Tips To Avoid/Delay Foreclosure Proceedings
- LegalMatch. "Foreclosure Alternatives." Accessed June 20, 2020.
- Cornell Law School Legal Information Institute. "Foreclosure." Accessed June 20, 2020.
- NOLO. "Homeowners’ Associations (HOAs & COAs)." Accessed June 20, 2020.
- Consumer Financial Protection Bureau. "How Does Foreclosure Work?" Accessed June 21, 2020.
- U.S. Department of Housing and Urban Development. "Are you at risk of foreclosure and losing your home?" Accessed June 21, 2020.
- Cornell Law School Legal Information Institute. "Equity of Redemption." Accessed June 21, 2020.
- FindLaw. "Regaining Ownership After Foreclosure: Statutory Redemption." Accessed June 21, 2020.
Tyler Lacoma has worked as a writer and editor for several years after graduating from George Fox University with a degree in business management and writing/literature. He works on business and technology topics for clients such as Obsessable, EBSCO, Drop.io, The TAC Group, Anaxos, Dynamic Page Solutions and others, specializing in ecology, marketing and modern trends.