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Pennsylvania The Process Pennsylvania's judicial foreclosure is not easy
for lenders. All actions to foreclose, accelerate or take possession are
stayed until the borrower is sent an "Act 91" notice giving the
borrower 30 days to meet the lender or a consumer credit agency listed on the
notice. Starting from the day of the first meeting, the
borrower has another 30 days delay to try and resolve the problem by
restructuring loan payments. Otherwise, the borrower can apply for a
Homeowner's Emergency Mortgage Assistance Program Loan and gain an extra
60-day delay on foreclosure to process the application. If the borrower has
had good residential credit for the past 5 years, is 60 days delinquent and
has a reasonable prospect of resuming loan payments in full within 36 months,
then the borrower should be approved. If the loan is disapproved, or no
meetings took place after the first 30 days, the lender may foreclose. Reimbursement Under "Act 6," which applies to home
loans under $50,000, the borrower must be sent a 30-day notice of the
foreclosure, during which time attorney's fees are limited to $50. Also, the
borrower may pay the past due payments and stop the foreclosure up to one
hour before the bidding at the sheriff's sale and may do this up to three
times in a calendar year. The Foreclosure Lawsuit The foreclosure complaint (lawsuit) must be filed
and served on the borrower. It must describe the property to be foreclosed
on. It must state the names of the borrower and the lender, the itemized
amounts due, the fact that the mortgage is in default and a demand for
judgment. Although the lender may state more than one reason to foreclose,
the lender may not sue to collect the money owed on the loan in addition to
the suit to force the sale of the property by foreclosure. The defendant may
file a counterclaim against the lender. The lawsuit however, must be tried
before a judge, without a jury. If the court orders foreclosure, then at
least 30 days before foreclosure the sheriff must give notice by putting a
handbill on the property, serving a copy on the borrower and advertising the
property for sale for three consecutive weeks. The sale takes place a month
or two after the court's order. Redemption There is no right of redemption after the sale. Deficiency Pennsylvania passed the Pennsylvania Deficiency
Judgment Act. The lender may file a lawsuit to collect on the promissory note
signed by the borrower within six months of foreclosure. This lawsuit must be
separate from the foreclosure lawsuit. The borrower has the right to force
the lender to credit the fair market value of the property sold at the
foreclosure sale against what is owed on the note. The suit must be filed
within six months after the foreclosure. |
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