Foreclosure -- the Process in Louisiana
Authored By: Southeast Louisiana Legal Services (Hammond Office, including information about applying for help online)
THE FORECLOSURE PROCESS IN LOUISIANA
Prepared by Southeast Louisiana Legal Services
To foreclose on your property in Louisiana, your mortgage company must file a foreclosure lawsuit in a court in the parish where your property is located.
This type of lawsuit is usually called a 'Suit on a Note' or 'Petition for Executory Process.' Next, the mortgage company (or its attorneys) must get a 'Writ of Seizure and Sale,' which is an order from the judge telling the Civil Sheriff to sell your property at a public auction. Sometimes this can happen very quickly.
The mortgage company can file the lawsuit and the sheriff's sale can occur as little as 60 days later. You may or may not be served with notice of the lawsuit or a notice of seizure by the sheriff. The mortgage company is only required to post a notice in a local newspaper and the sale can go forward even if you never knew your property was for sale.
Once your property is sold at auction, you no longer own the property.
The sheriff will make you leave your property sometime after the sale. You will likely not receive any notice to vacate and there is no eviction proceeding in court. It is almost impossible to challenge a sheriff's sale after it happens. Usually the only way to get your property back is to buy it back from the purchaser at fair market value (not the price it was sold for at the auction and not the amount of the debt you owe).
IF I AM BEHIND ON MY MORTGAGE PAYMENTS, WHAT CAN I DO TO
Depending on your financial situation, you may be eligible for:
A Repayment Plan: continue making your regular payments to the mortgage company and pay a little extra each month to pay back what you owe in missed payments and late fees;
A Forbearance Agreement: you are allowed to not make any payments, or reduced payments, for a few months, but the total of all missed payments and fees is usually due at the end of the forbearance period;
A Loan Modification: your interest rate is reduced, your missed payments and other fees are put into your loan balance, usually extending the life of your loan up to 40 years;
A Short Sale: you sell your house at a price that is less than the debt you owe to the mortgage company, the mortgage company agrees to forgive the rest of the money you owe;
Deed in Lieu of Foreclosure/Cash for Keys: you transfer all of your interest in the property to your mortgage company, move out and give them your keys. In exchange, they agree to forgive the money you owe and sometimes pay you a few thousand dollars cash;
To challenge the foreclosure in court;
To file a Chapter 13 Bankruptcy; or
To Refinance or obtain a Reverse Mortgage.
WHEN SHOULD I GET AN ATTORNEY?
If you are more than three months behind on your mortgage payments;
If you receive a letter from an attorney about your mortgage
If you receive a Notice of Seizure or a copy of a lawsuit about your mortgage that has been filed against you;
If you discover that your property is set for a sheriff's sale; and
If your loan is less than three years old and you think you may have been scammed into getting the loan by your mortgage broker or mortgage company.
Otherwise, please see a housing counselor in your area. For a list of housing counselors, please call (800) 569-4287.
Information not legal advice. This document has been prepared for general information purposes only. This is not legal advice. Legal advice depends on the specific circumstances of each situation. Also, the law may vary from state to state, so that some information may not be correct for your jurisdiction. Finally, the information contained is not guaranteed to be up-to-date. Therefore, this information cannot replace the advice of a competent legal representative licensed in your state.