pierceb's version from 2015-07-23 22:35


Question Answer
What is the general rule in NC for deficiency judgments?As a general rule, a mortgagee is entitled to a deficiency judgment. Thus, if at the foreclosure sale the property does not bring enough to cover the amount of the mortgagor's debt, the mortgagee may bring an action against the mortgagor for the unsatisfied debt.. Subject to FOUR exceptions in NC.
What is the FIRST anti-deficiency statute? SOLIf the STATUTE OF LIMITATION has run on the underlying debt, the creditor is precluded from recovering any deficiency.
What is the SECOND anti-deficiency statute? NoticeLack of Adequate Notice. A mortgagee foreclosing by "power of sale" must serve notice of the pre-sale hearing on interested parties. Any person liable on an indebtedness who DOES NOT RECEIVE NOTICE for a foreclosure sale or have ACTUAL NOTICE is NOT LIABLE for any deficiency.
What is the THIRD anti-deficiency statute? PMMThe mortgagee (creditor) is precluded from recovering any deficiency if: (1) the creditor is the SELLER of the property; (2) the mortgage or deed of trust SECURED THE PURCHASE PRICE of the property; AND (3) the mortgage or deed of trust shows ON ITS FACE that it secures the purchase price of the property (a seller who omits such a clause from the mortgage document is liable for the mortgagor's loss). NOTE: a third-party creditor such as a savings and loan is unaffected by this exception.
What is the FOURTH anti-deficiency statute? PowerWhere Mortgagee Purchases Mortgaged Property at Nonjudicial Sale: When mortgagee purchases property at POWER OF SALE foreclosure, her right to recover a deficiency is limited to the extent that the debtor proves that the REASONABLE VALUE of the property EXCEEDED what the MORTGAGEE (CREDITOR) PAID for it.
Must the agreement of a transferee to ASSUME the mortgage be in writing?NO! It may be oral or in writing.
If a transferee ASSUMES the mortgage, is the transferor (the original mortgagor) still liable to mortgagee (creditor)?YES! The transferee is Primarily Liable while the tranferor (the original) is Secondarily Liable to the creditor (mortgagee)
Does a mortgage interest on real property attach to crops and timber?YES! In North Carolina, a mortgage interest on real property also attached to any unsevered crops (timber). The mortgagor is NOT entitled to cut and remove timber from the land or sell the timber, UNLESS that mortgagee consents thereto and releases her security to that extent.



Question Answer
What is the general rule to notice for foreclosure hearings?Foreclosure proceedings require specific notice requirements, but they differ depending on whether the proceeding is a judicial foreclosure or a foreclosure under "power of sale."
What is the notice requirement for a JUDICIAL FORECLOSURE?Notice of the public sale must (1) be posted on the courthouse door 20 days and (2) published in the newspaper ONCE a week for TWO successive weeks.
What is the notice requirement for a POWER OF SALE?A "pre-sale hearing" must be conducted before the clerk of the court.
What are the FOUR issues considered at a "pre-sale" hearing?(1) Is there a valid DEBT?; (2) Has there been a DEFAULT?; (3) Does the mortgage INSTRUMENT AUTHORIZE foreclosure by power of sale; and (4) has PROPER NOTICE been given to those entitled to it?

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