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The Process
Foreclosures in Nebraska take place judicially, through
the filing of petitions for foreclosure in the Nebraska District Court for the
county where the property is located. If a prior lawsuit has been won by the
lender for the amount due on a loan, it does not stop a lender from filing a
subsequent lawsuit seeking a foreclosure sale of mortgaged premises. However,
before the court will hear a petition for foreclosure, the lender must prove it
has been unable to collect what was judged to be owed in the prior lawsuit. If
a suit has been brought for satisfaction of a mortgage rather than a true
petition for foreclosure, the lender can only seek the amount due and
possession of the property rather than true foreclosure. Whenever a petition
for foreclosure is filed either alone or in conjunction with a petition for
satisfaction of a mortgage, then the court can decree a sale of the mortgaged
premises or such part as is needed to pay off the loan and the costs of
suit.
While the lawsuit is pending, the borrower has the right
to bring in the past due payments, including principal and interest, and costs,
and the lawsuit proceedings will be suspended (stayed). Nevertheless, the court
will enter a decree of foreclosure and sale. This will not be enforced unless
there is a further order of the court, which will not be given unless the
borrower defaults in the future payment of any installment or a portion of
one.
The court may order the entire property to be sold, or
some part of it, based on a report by the sheriff as to what appears to be the
most feasible. The order of sale may be stayed up to nine months after the
judgment if the borrower files a written request for a delay (stay) with the
clerk of the court within 20 days after the judgment is rendered. Otherwise,
the order commanding the sale of the mortgaged property will be given 20 days
after the judgment.
The sheriff or officer holding the sale must give public
notice of the time and place of the sale by posting the notice on the
courthouse door and at five other public locations in the county where the
property is located. Two of the five locations must be in the precinct where
the property is located. In addition, the sheriff must advertise the property
for sale once a week for four weeks in a newspaper either printed in the county
or generally circulated in the county. After making the sale, the sheriff or
officer will report it back to the court, which will then confirm the sale.
Once the sale is confirmed, the borrower has no right to redeem the
property.
A deed shall be executed by the sheriff and it will vest
in the purchaser the same title the borrower had. The sales proceeds will be
applied to discharge the lender's debt, and if there is a surplus, it goes to
other persons who are entitled to it, or it must stay with the court for three
months before it can be paid to the borrower.
Deficiency
A deficiency is only possible as a continuation of a
foreclosure suit, but not while the foreclosure action is pending or remains
incomplete. |
