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    Foreclosures Real Estate

    Foreclosure is a legal process that allows lenders to recover the amount owed on a defaulted loan by taking ownership of and selling the mortgaged property. Learn more here.

     

    Navigating foreclosure proceedings can be a daunting task, especially as rules and regulations can vary significantly from state to state. In Pennsylvania, the legal framework for foreclosures is defined in the Pennsylvania Rules of Civil Procedure – rules 1141 to 1150 – and by the Pennsylvania Statutes Annotated Title 35 and 41. As a judicial foreclosure state, Pennsylvania only allows for foreclosure cases to be resolved within the court system., and lenders must bring a foreclosure lawsuit against delinquent borrowers.

    For the purposes of acquiring a previously foreclosed-upon property, the following information is important.

    f the borrower does not answer the foreclosure complaint or fails to answer in the required timeframe, the lender may file for a default judgment. If the court rules in favor of a default judgment, the borrower automatically loses the case, and the lender forecloses on the property. If a homeowner does file an answer according to state requirements, the lender may not seek a default judgment.

    Usually in this case the lender will file for a summary judgment, asking the court for a swift, favorable decision without going to trial. Lenders will usually argue in favor of a summary judgment based upon the borrower’s weak defense or lack thereof, the indisputable facts of the suit itself, or if there is no proof of wrongdoing such as predatory lending. If a summary judgment is denied, the case goes to court. If the borrower loses at trial, the court will issue a final judgment of foreclosure and the property will be put up for sale at a foreclosure auction.

    If the previous owner does not voluntarily vacate the property following a successful foreclosure sale, the new owner will usually either offer a cash for keys deal or pursue eviction. The former involves the lender paying out a financial incentive to the previous owner to voluntarily vacate the property. If this option is not be pursued, the new owner must file a separate eviction suit against the former owner.