Virginia Foreclosure Laws

Attorney General's Office

101 N. Eighth St.
Richmond, VA 23219
Ph: (804) 786-2071
Fax: (804) 786-1991

Foreclosure Laws in Virginia

Judicial Foreclosure: Yes
Non-Judicial Foreclosure: Yes
Security Instruments: Trust Deed / Mortgage
Right of Redemption: Varies
Deficiency Judgments: Yes
Time Frame: 60 Days
Public Notice: Publication

Judicial foreclosure: Requires the lender, in the absence of a power of sale clause in the loan document, to sue the borrower in court and obtain an order of foreclosure. The court then orders the property to be sold.

Non-judicial foreclosure: May be used when the loan document contains a power of sale clause authorizing the lender to sell the property to pay off the loan balance in the event of the borrowers’ default. Should the power of sale clause contain instructions as to the time, place, and terms of sale, that procedure must be followed. If not, the process is as follows:

1. The notice of sale must be published for three days, regardless of provisions for advertisement of the sale contained in the deed of trust. If no provisions for advertisement exist, then the notice must be published weekly for four consecutive weeks. If the property is in or near a city, five consecutive daily publications may be deemed sufficient. At all events, notice must be given at least 14 days before the date of sale.

2. The sale shall be held no sooner than eight days after the first publication of the notice of sale and no later than 30 days after the last publication. Written bids may be accepted by the lender’s trustee and must be announced at the sale. Any bidder in attendance may inspect such bids. The successful bidder shall deposit 10% of the sale price with the lender’s trustee.

3. Postponement of the sale is at the discretion of the trustee. Postponement shall be advertised in the same manner as the original notice of sale.

4. The borrower's redemption period varies by case. Redemption period is usually during foreclosure process up to the sale. (Lender Mediation redemption period 300-345 days, Tax sale no redemption period, State Auditor's up to 18 months, IRS Tax seizure 180 days. In some cases where the remption period is allowed, there is a percentage on top of what's owed in order to redeem the property.)

Laws:

• Section 8.01-427. Persons entitled under decree deemed judgment creditors; execution on decree
  Law which regulates a notice be filed, giving the homeowner an opportunity to pay by a specific time before continuing the foreclosure process.

• Section 63.2-1934. Action for foreclosure of lien; satisfaction
  Law which regulates the owner may cure a lien prior to being sold at auction.

• Section 63.2-1935. Satisfaction of lien after foreclosure proceedings instituted; redemption
  Law which regulates the right of the owner to purchase back property after it has been sold.

• Section 6.1-422.1. "Flipping" prohibited
  Law which regulates a lender or broker from refinancing a mortgage unless it benefits the owner.

• Section 8.9A-608. Application of proceeds of collection or enforcement; liability for deficiency and right to surplus
  Law which regulates the owner’s right to any over payment of proceeds from the auction.

• Section 8.9A-616. Explanation of calculation of surplus or deficiency
  Law which regulates the owner be provided a document which states, who, where, when and how proceeds were distributed.

• Virginia State Statutes