Connecticut Foreclosure Process

Link to Connecticut Foreclosure Laws

The judicial foreclosure process in Connecticut is commenced by filing a civil action with the Superior Court known as a Lis Pendens

Foreclosure Overview

Connecticut only does judicial foreclosures. Within the judicial foreclosure the judge presiding over the proceeding has the option to grant either a “strict foreclosure” or a “foreclosure by sale.”

A recent law now requires a 60-day demand letter be sent prior to the filing a foreclosure action. once the 60 day limit on the demand letter has run out, the foreclosure proceeding can commence. The timeline is typically3-4 months through completion. Connecticut does not allow for non-judicial foreclosures.

Strict Foreclosure

The judicial foreclosure process in Connecticut starts by the lender filing a civil action with the Superior Court known as a Lis Pendens (LIS). When the Lis Pendens has run to completion, the Lender then files a motion for a judgment of foreclosure at which point the Judge grants either a “strict foreclosure” or a “foreclosure by sale”.

If a strict foreclosure is granted, no actual foreclosure sale is held. The reason for this has to do with the perceived equity in the property. During the foreclosure proceedings, if the court has determined that there is no equity in the property, the court assigns what are known as “law days”. Law Days allow parties with an interest in the property to redeem it. it is done in reverse order. meaning the lender or lien holder with the least interest gets first crack at the property. If no party redeems the property on their law day, and all parties have had their chance to do so, title of the property will vest free and clear in the lender.

After that, the lender then has 30 days to record a certificate of foreclosure The Certificate of Foreclosure must contain a description of the property, the foreclosure proceedings, the mortgage and the date the title became absolute.

 

Foreclosure By Sale

If the court determines that there is enough equity in the property to do so, the judge will order a foreclosure by sale. The court establishes the time and manner of the sale and assigns a “committee attorney”, similar to the trustee in other states,  to handle all aspects of the foreclosure sale. This attorney is appointed by the court and is NOT is not the same attorney who commenced the foreclosure action on behalf of the lender.

At any time during a Connecticut foreclosure proceeding, up to the time of sale, the borrower may stop the foreclosure by paying the balance due on the mortgage. If this does not occur, the committee will go forward with the sale. Once the sale is successfully conducted, the committee attorney then petitions the court to “approve” the sale so that title may vest in the successful bidder.

Although the borrower has lost the property at the sale, Connecticut Foreclosure Law in addition allows the lender to sue the borrower to obtain a deficiency judgment, in addition to having forfeited the property.

 

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