Indiana Foreclosures are all judicial, meaning “in court” foreclosure proceedings. when a borrower defaults on their mortgage payments in Indiana, the servicer of the loan, on behalf of the lender, will begin a foreclosure. Approximately half of all states, including Indiana, require the lender to file a lawsuit in court to foreclose. State law spells out how foreclosures work, and both federal and state laws give the borrower many rights and protections throughout the process.
The foreclosure process begins when the lender files a complaint in court against the borrower, usually after 120 days. Indiana foreclosure law does not require that a lender send a default notice to the borrower before filing the complaint, however, most lenders do. The date that a mortgage was executed controls the pre-foreclosure period between filing the complaint and the foreclosure sale. Most often it is three months, but for older mortgages, it can be six or 1even up to 2 months.
There is no waiting period for abandoned properties. The owner may agree to dismiss this pre-foreclosure period, allowing the sale to proceed; however, this will cause the lender to lose any rights to pursue any part of the debt not satisfied by the foreclosure sale.
After the pre-foreclosure period expires, a copy of the order of sale and judgment are issued and certified by the county clerk to the county sheriff. After receiving the order, the sheriff proceeds with the foreclosure sale.
At any time before the foreclosure sale, a borrower may satisfy the judgment by paying the debt, interest, and costs; the complaint must then be dismissed.
If the home is the borrower’s primary residence, the lender is required to mail a pre-foreclosure notice not later than 30 days before filing a lawsuit to foreclose with the court. This notice must:
- inform the borrower that they are in default
- encourage the borrower to obtain assistance from a mortgage foreclosure counselor
- inform the borrower of their rights after a foreclosure judgment, and
- provide contact information for the Indiana Foreclosure Prevention Network (IFPN).
Notice of Sale & Auction
The county sheriff appoints an auctioneer to conduct the foreclosure sale.
The notice of sale must be published once a week for three (3) weeks in a local newspaper, and the first publication must occur a minimum of 30 days before the sale. The sheriff is also required to post the notice of sale in at least three public places, as well as the county courthouse. The borrower must be served with the notice of sale by the sheriff. Immediately after the foreclosure sale, the sheriff transfers the property ownership to the winning bidder by sheriff’s deed. If a lender postpones the sale, another sheriff’s sale request must be filed, and all the notices must be re-served and republished.
Borrowers have no longer has redemption rights after the sale.