I still get a sick feeling in my stomach when I recall the lady who called me to say that her home was in foreclosure but her husband new nothing of it because she paid the bills.  She was hiding her gambling problem and the unpaid mortgage from him.  I told her that she needed to speak with him and then come see me immediately to stop the sale.  About a month later she called again saying she finally got the courage to speak to her husband.  He said he loved her and just wanted to stop the foreclosure, so they wanted an appointment.  I looked up her case and again and verified the foreclosure sale date.  My heart sank as I told her the home was sold the day before and there was nothing I could do to save the home.

How can this happen?  Why don’t homeowners know if their home is in foreclosure and when the sale will occur?  The reason is both appalling and common.  Under the Nebraska Trust Deed Act the homeowner receives notice of the foreclosure and sale by Certified Mail.  There is no requirement that a Sheriff personally deliver the notice.  There is no requirement that the homeowner sign for the certified mail.  The only requirement is that the notice be sent by certified mail.

Under postal regulations, if a person is not home when the certified mail is delivered the mailman should leave a postcard in the mailbox advising that they attempted to deliver a certified letter and that the homeowner has a certain number of days to go to the post office to get the letter.  The problem is, lots of unpleasant news comes via certified mail.  Some folks refuse to get their certified mail because they believe it may be a lawsuit and they don’t want to accept service of summons.  Many people say that “nothing good comes from certified mail” and they just ignore it.  Some clients complain that are working when the mail arrives and they never received a postcard telling them that certified mail arrived.

If you are seriously behind on the mortgage payment and have the nagging feeling that the home is in foreclosure, here are some ways to determine when the home will be sold at foreclosure:

  1. Call the Mortgage Company.  This seems obvious, but the best source of information is your mortgage company.  If you are in foreclosure the bank should be able to give the name and phone number of the law firm handling the foreclosure.  The bank may not actually know the date of sale date since the attorneys handle the legal proceedings, but if the loan is in foreclosure they should be able to prove the attorney’s name and phone number.  Call that attorney to check the status of the sale.
  2. Check Online Foreclosure Sales Listings.  There are only a handful of attorneys that handle foreclosures in Nebraska.  Some of these law firms, such as Kozney-McCubbin and South & Associates, have websites listing the upcoming foreclosure sales.
  3. Call Local Foreclosure Attorneys.  Most law firms that handle foreclosures will verify if a sale date is scheduled.  Call these law firms and ask their foreclosure departments to see if they are handling the foreclosure.  Some of the more common firms handling foreclosure matters include Eric Lindquist PC,   Steffi A. Swanson PC, and Walentine, O’Toole, McQuillan & Gordon PC.
  4. Check the Local Newspaper Legal Notices.  A Trustee Sale must be published in a legal newspaper in the county of the sale for five consecutive weeks.  Some of these newspapers are somewhat obscure, such as The Daily Record, that only publish legal notices.

When it comes to stopping  a foreclosure sale, time is of the essence.  You don’t have time to wait.  Filing chapter 13 bankruptcy is one way to stop a sale.  Under a chapter 13 case a homeowner is given 3 to 5 years to pay back the delinquent mortgage payments.  The moment a chapter 13 case is filed a federal court order automatically stops all pending foreclosure sales (with some exceptions for serial bankruptcy filers).

Bankruptcy attorneys need time to prepare a case, so if a sale is pending it is imperative that you make an appointment as soon as possible.  Prior to filing bankruptcy the homeowner must take a credit counseling class and provide their attorney with a certificate of credit counseling.

Another option to request a Loan Modification.  However, if a sale date is pending it may be too late to file an application.  Sometimes the wiser move is to file a chapter 13 case to stop the sale and then file the Loan Modification application so that the process may be completed in an organized fashion.  You can get a loan modification even if you are in the middle of a chapter 13 case, and the bankruptcy case can be dismissed if the loan modification is successful.

Image courtesy of Flickr & Fibonacci Blue.