Judicial Foreclosure vs. Non-Judicial Foreclosure

Judicial Foreclosure

In the state of Maryland, a judicial foreclosure is pursued when the security instrument consists neither a power of sale that will authorize the lender to sell his/her property in the event, nor an agreement to a judicial decree of forclosure.

If the loan document depicts an assent to a decree of foreclosure, it will clearly show that the borrower agreed to entry a decree of sale. The lender also needs to file a complaint against the borrower to forclose; there is no hearing required to continue with the sale.

If the borrower and lender is not present in the loan document, the lender will sue to gain a decree of sale. The court will then rule if a default has taken place. If the court comes to a decree of sale, it will fix the amount then due and arrange a legitimate period of time for the borrower to fix the default.

Non-Judicial Foreclosure

This is used when the document contains a power of sale. However, the lender will still file an order to the court's docket before any proceed can begin. There is also not hearing required.

A sale notice needs to be published weekly for a duration of three successive weeks prior to the sale. Which is then served upon the borrower by registered mail to last no more than 30 days or less than 15 days prior when the sale occured.

During the 30 day time period after the sale, the person that is conducting the sale files a report of the sale with the clerk of the court. The clerk will then issue a sale notice to be ratified unless cause to disqualify is presented within the 30 days. The notice has to be published weekly for three weeks consecutively during the 30-day time period. A suit for inadequacy, or for any deficiency for that matter, must be filed within three years.

During the event of a postponement, the new sale date has to also be published in the same approach as the original notice of sale.