Virginia Foreclosure Law
- Judicial Foreclosure Available: Yes
- Non-Judicial Foreclosure Available: Yes
- Primary Security Instruments: Deed of Trust, Mortgage
- Timeline: Usually 60 days
- Right of Redemption1: Varies
- Deficiency Judgments2 Allowed: Yes
Lenders in the state of Virginia may foreclose on deeds of trusts and mortgages in default using either the judicial or non-judicial foreclosure process. However, judicial court foreclosures are rarely used.
Judicial Foreclosure
A judicial process of foreclosure requires that the lender file a lawsuit and attain a court order to foreclose on a particular property.
Under a judicial foreclosure, the borrower has the right to redeem. If the borrower pays the amount for which the property was sold, plus six (6) percent interest, within two hundred and forty (240) days from the date of the sale, they can redeem the property.
Non-Judicial Foreclosure
If a power of sale clause exists in the deed of trust or mortgage document, a non-judicial process of foreclosure is used. This allows the lender to sell the property and pay off the balance of the loan in the event the homeowner defaults. The power to sell may be completed by the lender or their representative in situations where a power of sale exists. The procedure for this type of foreclosure process is explained in the "Power of Sale Foreclosure Procedure" listed below.
Power of Sale Foreclosure Procedure
If the deed of trust or mortgage has a power of sale clause and it details the time, place and terms of sale, then the outlined procedure must be followed. Virginia statutes further require that:
- In addition to the advertising requirements stipulated in the deed of trust, the notice of sale advertisements must also be published no less that once a day for three (3) days, which may be consecutive. If the deed of trust does not provide for advertising, then the ad will run once a week for four (4) consecutive weeks.
- A notice of the sale or a copy of the advertisement is mailed to the borrower at least fourteen (14) days prior to sale.
- The sale is be held no earlier than eight (8) days after the first advertisement is published and no more than thirty (30) days after the last ad is published.
- The sale is by public auction to the highest bidder. All may bid at sale, including an individual submitting a written one-price bid. Written one-price bids may be made and received by the trustee. They will be announced by the trustee at the time of sale. Any bidder in attendance may also inspect written bids.
Prior to the sale, the borrower may cure (stop the foreclosure proceedings) by paying the lien debt, costs and reasonable attorney fees. After the sale occurs, there are no rights of redemption provided to the borrower. The lender can, if they choose, cancel the sale if the borrower is able to pay off what is owed.
Lenders may obtain deficiency judgments, without limits.
1 A borrower’s right to reacquire property lost due to a foreclosure.
2 A personal judgment against the borrower for the remaining balance on the loan after a foreclosure sale.
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