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The Process
Judicial foreclosure available: Yes
Non-Judicial foreclosure available: Yes
Mississippi offers two methods of foreclosure: by filing
lawsuit asking for foreclosure in a Chancery Court and by sale, if authorized
in the mortgage and conducted in compliance with Mississippi's statutes. The
borrower's right to properly conduct of the sale, after proper notice and
advertisement of the sale, may not be waived in the loan documents. Any defect
in the sale that would cause it to be void may not be corrected by the statute
of limitations until ten years have passed from the date of the defective
sale.
If the deed of trust contains an authorization for the
lender to call upon a trustee to sell the real estate due to the borrower's
default on the loan, such as by non-payment then the real estate may be sold by
the trustee named in the deed of trust (or later appointed as a substitute) to
try and pay off the loan. No sale by a substitute trustee is valid un less it
was first recorded in the Office of the Chancery clerk of the county where the
land is located, prior to the first posting or publishing of the foreclosure
sale notice. If the lender, instead of some other buyer, acquires title to the
real estate at foreclosure, then the lender will give credit for the
foreclosure sale price against what was due on the loan.
Preliminary Notices
Advertising
In order to be valid, the foreclosure sale must be
advertised for three consecutive weeks before the sale in a newspaper of
general circulation in the county in which the land is located.
Posting
In addition, one notice must be posted for the same time
at the county courthouse door. The notice must name the borrowers who will lose
title.
Cure Procedure
The borrower may stop the foreclosure at any time prior
to the sale by coming up with the missed payments, accrued costs and attorney's
and trustee's fees. Only the amount that is actually past due needs to be paid.
Even though the loan documents provided that the lender could accelerate the
loan and make all future payments due, the borrower has the legal right to
disregard the acceleration and stop the foreclosure by paying up the missed
payments, accrued costs and attorney's and trustee's fees. The loan is then to
be treated as though it was not accelerated. The borrower may continue to own
and occupy the property and the lender may not foreclose.
Sale Procedures
Place
The place of sale should be the same as the place of
sale for sheriff's sales of property in the county, which is usually the
courthouse.
Manner
The sale must be made by public outcry in the county
where the land is located, or in the county where the borrower lives. The sale
must be for cash to the highest bidder.
Post-Sale Matters
After the sale, the trustee or substitute trustee must
deliver a trustee's deed to the successful high bidder. The deed should give
the names specified in the old deed of trust that was foreclosed on. The
trustee's deed should also give information sufficient to locate the foreclosed
deed of trust or mortgage in the deed records.
Special Procedures - Foreclosure and Major
Disasters
In Mississippi, the governor may declare that a natural
disaster, an enemy attack, or a man-made technological disaster makes it
imperative to impose a moratorium on foreclosures. The moratorium may last for
up to two years after the governor's declaration. The borrower can go to court
and file a lawsuit to enjoin a lender from foreclosing. This would be due to
damages to the mortgaged premises or because of economic conditions brought
about by enemy attack, natural disaster or man-made technological disaster
causing the fair market value of the property to decline by 15 percent, if
refinancing is impractical under the circumstances. No cash is required on the
injunction. The borrower must take action because a foreclosure conducted
during a moratorium while the borrower did nothing is valid, even though the
borrower could have won by exercising these rights.
Redemption
A foreclosure sale under a deed of trust is final in
Mississippi. There is no right of redemption. |
