Tennessee Foreclosure Law

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Tennessee Foreclosure Laws

Typical Tennessee Foreclosure Time Frame – Typical Tennessee foreclosures last an average of 60 days.

Judicial Foreclosure – Yes

Non-Judicial Foreclosure – Yes

Types of Security Instruments – Mortgage and Deed of Trust

Right of Redemption Period – Two years, unless waived in the original deed of trust or mortgage.

Tennessee foreclosure laws allow lenders to use both judicial and non-judicial foreclosure procedures in order to cure defaults in mortgages.  To use a judicial foreclosure process Tennessee foreclosure laws require that the mortgage contract or deed of trust not contain a power of sale stipulation or clause. 

In the event of a judicial foreclosure in Tennessee, the lender is required to sue the borrower in court to obtain a Decree of Foreclosure.  The courts will then order the borrower a specific amount of time in which to correct the default before the property is ordered to be sold.  In the event that the borrower fails to correct the default, a sale of the property is ordered.

For a non-judicial foreclosure in Tennessee, the lender is required to follow the terms and conditions set forth in the power of sale clause.  In the event that the clause does not give the exact procedure for the sale, Tennessee foreclosure law provides the guidelines that must be used.

Under Tennessee foreclosure law, the lender is first required to publish at least three separate times a copy of the notice of sale in the local public newspaper in the county in which the property is located.  It is required that the first date of publication be no sooner than 20 days from the date of the sale.  In addition it is required that a copy of the notice must also be served upon the borrower no later than 20 days before the date of the sale.  In the event that no local newspaper is in the county where the property is located, the lender is required to post a copy of the notice in a minimum of five public places around the county.  Of these five published notices one must be one the door of the courthouse, and another must be in the neighborhood where the property is located, the other three are required to be posted in public locations.

The sale itself is conducted by the sheriff for the county in which the property is located and must be held between the hours of 10 a.m. and 4 p.m. on the date set forth by the notice of sale.  The sheriff is authorized to set a minimum price for the property; however, this must be at least 50% of the properties fair market value if a minimum price is set.  The highest bidder at the sale will receive a certificate of sale and upon expiration of the borrowers redemption period will receive a deed.

The borrower is permitted two years from the date of the sale of the property in which to redeem the property.  If the borrower waived the rights of redemption in the original deed of trust then no rights of redemption are allowed under Tennessee foreclosure law.

Tennessee foreclosure law does allow lenders to seek deficiency judgments in the event that it is necessary.

For more information on Tennessee foreclosure laws click here.

 

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The information found on this site is not intended to be legal advice. The foreclosure process is highly case specific and laws vary throughout the United States. Please seek professional legal counsel before entering into any contract regarding any real property or stopping the foreclosure on any real property. By using this site you consent to the terms posted here.