Challenging a Foreclosure Before the Sale
If, for some reason, you believe that you have a legal case to stop a foreclosure before the sale of the house occurs, you must discuss the issue with an Attorney (unless you are an extremely legally sophisticated borrower) to see what, if any, recourse you may have to stop the sale.
To stop a foreclosure sale from occurring, aside from filing for bankruptcy, you must file an Injunction with the court. An Injunction or Temporary Restraining Order is a Motion that is filed with the court asking for the sale to be stopped. An Injunction should be filed as soon as you discover that you may have a legal case that could justify why the sale should not go forward. Injunctions to stop a sale in the past were very difficult to get, but now, courts are more inclined to listen to the request from a homeowner to stop a sale.
Injunctions and/or Temporary Restraining Orders can be issued only for 10 days. If the lender cures the legal issue, it may proceed with the foreclosure. In the event that you may have a legal case that calls for an Injunction and/or Temporary Restraining Order, the court may require you to file a Motion for a Permanent Injunction. Generally speaking, Injunctions require a hearing in front of the judge where parties get an opportunity to argue their reasons for wanting the sale stopped. Helpful Hint: Maryland Rules are very particular about what information must go into a request for an Injunction and/or Temporary Restraining Order.
Challenging a Foreclosure After the Sale
If, after the foreclosure sale, it is discovered that the lender failed to follow Maryland foreclosure laws; you must file Exceptions to the sale before the sale is Ratified. Technically, Exceptions must be filed within 30 days of the Notice of Report of Sale or within 30 days of the Report of Sale, whichever is filed first. You will know that a Report of Sale or Notice of Report of Sale was filed because you will have either logged on to http://www.courts.state.md.us/ or called the court to track the status. Most homeowners will never know if the sale was done properly unless they met with an Attorney who reviewed the record and found an error.
Please note, simply because an error was discovered does not mean that the court will set-aside a sale. “Set-aside a sale” is legal jargon for having the foreclosure become void. This is the ultimate goal of filing Exceptions.
Filing Exceptions is an uphill battle and Maryland has well settled case law on what the court is willing to consider in setting aside a sale. For instance, a court will not set-aside a sale if:
- You attempted to reinstate and you were five dollars short and the lender refused to accept your payment and foreclosed on your property;
- You loss your job, fell ill, or lost a loved one; or
- You filed a bankruptcy after the sale was conducted.
Foreclosure 101 