With the COVID-19 foreclosure moratoriums over, housing foreclosures are once again on the rise nationally. In fact, in September of 2023, we saw home foreclosures on the rise by a whopping 18.4% from this time last year. Foreclosures in Indianapolis have also been increasingly more common.
Indiana has not been immune to this national trend. Ranked at #12 in the nation for foreclosures, Indiana has a foreclosure rate of one in every 3,158 homes. With 2,911.562 housing units in the Hoosier state, 922 homes went into foreclosure just in October.
With this trend unlikely to dissipate any time soon, Indiana homeowners need to know the laws around home foreclosures.
Foreclosure Laws in Indiana
If you or a loved one are facing foreclosure, chances are there are a lot of feelings of being overwhelmed involved. That’s why knowing the laws that pertain to said foreclosure is vital in calming your anxiety so you can face it head-on.
Federal law dictates that foreclosure measures cannot be started until your payment is at least 120 days overdue. In the state of Indiana, law dictates that the lender must contact you at least 30 days prior to filing the suit with the following information:
- The lender must inform you of the default.
- The lender must provide you guidance in seeing the assistance of a mortgage foreclosure counselor.
- The lender must inform you of your rights such as the right to pay off the entire debt to stop the sale.
- The lender must provide you with contact information for the Indiana Foreclosure Prevention Network.
- The lender must provide a warning to you about seeking help from untrustworthy sources looking to help you avoid foreclosure.
Once this contact has been made, the lender has 30 days before they can file the lawsuit for the homeowner to have time to research their options.
The Foreclosure Process
If a lender is foreclosing on a property, the first thing they will have to do to initiate the process is to file a lawsuit in court to initiate a request for a foreclosure sale. Once notified, the homeowner has 20 days to file an answer to the complaint. If the homeowner does not do this, the lender will request a default judgment so they can continue with the foreclosure sale.
If the homeowner chooses to defend the lawsuit, then litigation will begin. During this time, the lender will most likely ask the court for a summary judgment, which asks that the court grant a judgment in favor of the lender. If the court grants one or the homeowner loses, your home can be sold at auction.
In most instances, the sale cannot occur until at least 3 months after the lawsuit has been filed. Once the sale can move forward, the sheriff will post a notice of sale at the courthouse and advertise the sale in the local newspaper. When the first advertisement is posted, at least 30 days before the sale, the sheriff will serve a notice of sale to the homeowner.
Can You Get Out of Foreclosures in Indianapolis?
If your lender files a lawsuit for foreclosure, all hope is not lost. There are a few ways you can potentially stop a foreclosure on your home.
These options include:
- Reinstating the Loan: If the homeowner reinstates the loan before the court enters the judgment, the foreclosure will be postponed. However, if another payment is missed, the foreclosure can commence.
- Redeeming the Property: Redeeming the property means paying off the full amount of the loan before the foreclosure sale continues.
- Filing for Bankruptcy: If you’re running short on time to stop foreclosure, filing for bankruptcy will stop proceedings immediately. An automatic stay goes into effect at this point which, at least temporarily, stops the lender from being able to collect on the debt through a sale.
Foreclosures in Indianapolis? Receive Guidance from Sawin & Shea, LLC
If you’re facing foreclosure, the sooner you can get the counsel of experts who understand your rights, the better. The attorneys of Sawin and Shea have years of experience navigating through Indiana’s foreclosure laws. We can answer your questions about foreclosures in Indiana and help you better understand your rights to stay your home’s foreclosure with Chapter 13 bankruptcy. Contact us today at 317-759-1483 to discuss your case.