Thursday, September 30, 2010

Wisconsin Foreclosure Laws

Wisconsin Overview
Judicial Non-Judicial Process Period Sale Publication Redemption Period Sale/NTS
Yes Yes 290 Days NA 365 Days Sheriff
Comments:Judicial Foreclosures are more common

Pre-foreclosure Period
A Wisconsin foreclosure begins when the lender files the appropriate documents with the court. The lender must deliver a notice of the court filing to the borrower and other parties with an interest in the property, in order for a lender to obtain a foreclosure ruling from the court. The court may order in its ruling that all sums paid by the lender for insurance, repairs, and taxes be added to the amount owed.

Based on precedent in Wisconsin, the lender customarily warns the borrower that they intend to foreclose on the property before filing with the court.

Once the court has issued a judgment of foreclosure, the borrower has a reinstatement period to stop the foreclosure by paying off the amount owed. The reinstatement period varies widely based on the mortgage date and terms, parcel size, and occupancy status. Abandoned properties have a two-month redemption period, while most other properties have 6-12 months.

Notice of Sale / Auction
The local sheriff gives notice of the time and place of sale either according to the law or as instructed in the court’s ruling. In most cases, the foreclosure sale cannot occur until after the owner’s reinstatement period is completed. The notice of sale is published within that 12-month period, although the first publication has to be at least 10 months after the date the court’s ruling is entered. The parties may consent to an earlier sale.
The sheriff conducts the foreclosure sale, and any party with 10 percent of their maximum bid at the sale may bid. The 10 percent amount must be payable to the county sheriff. Within 10 days, the sheriff files a report of the sale and deposits the proceeds with the clerk of the court. Upon confirmation of sale, the clerk pays the parties entitled to the sale proceeds and delivers the deed transferring ownership to the highest bidder, who must pay the balance of the sale price. If the buyer fails to pay the balance of the sale price within 10 days after the confirmation of sale, the deposit is forfeited, paid to the entitled parties, and a resale is held. If the court does not confirm the sale, the clerk refunds the buyer’s deposit and a resale occurs.

In the case of a surplus, other affected lien holders may file a notice with the clerk of the court, and the court determines who is entitled to any or part of the surplus.

If the property sells for less than the default amount and sale costs, the sale will not be confirmed and no judgment for deficiency rendered until the court is satisfied that the fair value of the property has been credited on the mortgage debt, interest and costs.

JPMorgan Chase’s Foreclosure Documents Were Bad Too

A Bloomberg report shows homeowners’ attorneys’ claims were right: The problem of faulty foreclosure documents was not limited to GMAC. A JPMorgan Chase (JPM) employee testified in a deposition that she was one of eight managers who combined to sign some 18,000 documents a month without the personal knowledge the documents claimed they had. As these revelations come out across the industry, the foreclosure market is likely to shut down while courts figure out what to do. Already-sold foreclosures may have their titles clouded. Foreclosures under way will be stopped or slowed while documents are checked, and future foreclosures will be delayed. That’s because the improper affidavits leave open the possibility that the foreclosing bank doesn’t really own the loan it’s foreclosing on. After all, not all accusations of bad mortgage documentation involve “technicalities.”
Of course, there’s one easy thing the banks can do to address this mess, assuming they still want to foreclose on all these properties: Hire enough people to have employees personally and properly verify the information in the documents they sign and send to court.