A Kansas Foreclosure is judicial. This means that it is conducted through the court. A given property can go to foreclosure sale in as little as 60 days. However, there is a redemption period so a Sheriff’s Deed may not be issued until anywhere from three months to 12 months after the sale.
Before a lender is allowed to foreclose on a borrower’s Note and Mortgage, a title search is typically conducted. Liens that appear senior to the lender’s lien need to be addressed prior to foreclosure or the purchaser at the sale will be required to take the property subject to the senior lien.
All junior lien holders must be named as defendants in the lender’s foreclosure suit. This is to ensure that title is free and clear of liens at the time of the foreclosure sale. Note that this sometimes does not happen perfectly, and a quiet title suit may be need to clear title after the sale.
In a Kansas foreclosure, the borrower generally has the right to:
- receive notice before the foreclosure in the form of a “breach letter”.
- apply for loss mitigation.
- get notice of the foreclosure.
- have the chance to respond in court.
- receive special protections if the borrower is in the military.
- pay off the loan to prevent a foreclosure sale.
- redeem the property after the sale. (Time for redemption varies).
- get excess money if any exists, after a foreclosure sale.
Notice of Sale & Auction
Once a borrower has defaulted, a lender can file a Petition for Mortgage Foreclosure, (PMF), with the court. The Petition is then served on the borrower as well as any other named defendants. If a defendant cannot be found, Kansas law also allows for service by publication. Once service is obtained, the defendants have 20 days to file an Answer with the court. If any of the defendants fail to file an Answer, the court will then enter a Journal Entry of Judgment. However, if the borrower files an Answer contesting the foreclosure then the parties can litigate the matter and possibly even go to trial.
Once judgment is entered in favor of the lender, the borrower then has 10 days to pay the amount due before the foreclosure sale can be scheduled.
After the expiration of 10 days from the date judgment was entered, a Notice of Sheriff’s Sale, (NOS) is published in a local newspaper for that county where the property is located once a week for three weeks. The Sheriff’s Sale must be held between 7 and 14 days after the final notice of sale is published. The lender provides the opening bid; typically, the full amount owed to the lender by the borrower. The person with the highest bid at the sale receives a Certificate of Purchase from the Sheriff.
In a Kansas foreclosure, the redemption period for the borrower begins on the sale date, however, the length of time varies.
- If more than one-third of the principal balance of the loan has been paid, the borrower has a12 month redemption period.
- If the borrower has paid less than one-third of the principal balance of the loan, the borrower only gets a 3-month redemption period.
To redeem, the borrower has to pay the amount of the highest bid as well as applicable interest, as set by the court, and other fees.
Once the borrower’s right of redemption expires and the property has not been redeemed, a Sheriff’s Deed will be recorded with the new owner named.