NH & Maine Foreclosure Laws

The foreclosure process varies somewhat from state to state, and depends primarily on whether the state uses mortgages or deeds of trust for the purchase of real property. Generally, states that use mortgages conduct judicial foreclosures, using the court system to execute the foreclosure; states that use deeds of trust conduct non-judicial foreclosures, using an out-of-court procedure defined by state law.

Foreclosure Procedures in NH & Maine

To foreclose in accordance with the judicial procedure, a lender must prove in court that the mortgagor is in default. Once the lender has exhausted its attempts to resolve the default with the homeowner, the next step is to contact an attorney to pursue court action. The attorney contacts the mortgagor(homeowner) to try to resolve the default. If the mortgagor is unable to pay off the default, the attorney files a lawsuit against the mortgagor to establish the default amount and the right to have the collateral(home) sold and the sale proceeds applied towards the outstanding loan. The purpose of the action is to provide evidence of a default and get the court’s approval to initiate foreclosure. In connection with the lawsuit, a lis pendens (lawsuit pending notice) is filed with the county clerk or other public property records repository. The lis pendens gives notice to the public that a pending action has been filed against the borrower in default to collect the defaulted debt, including having the collateral (home) sold.

Non-judicial foreclosures are based on deeds of trust that contain a power-of-sale clause. The clause enables the trustee to initiate a foreclosure sale of the collateral(home), without having to file a lawsuit or go to court. The trustee is typically required to issue a notice of default and notify the trustor (borrower) accordingly about the defaulted loan status. If the trustor does not respond, the trustee then initiates the steps for conducting the foreclosure sale of the collateral (home).

New Hampshire Overview

Non-Judicial Foreclosure

The non-judicial process of foreclosure is used when a mortgage contains the Statutory Power of Sale. A "power of sale" clause authorizes the sale of property to pay off the balance on a loan in the event of a default. In mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender. Regulations for this type of foreclosure process are outlined below in the "Power of Sale Foreclosure Guidelines".

Power of Sale Foreclosure Guidelines

A notice of sale must be mailed to the borrower at least 25 days before the sale, published once a week for 3 weeks with the first publication appearing not less than 20 days before the sale in a newspaper of general circulation in the county where the property is located.  The notice should contain the time, date and place of sale, a description of the property as well as a "warning" to the borrower, informing him the property is going to be sold and what rights he has to stop the procedure. The Notice must also be sent to any party with a recorded interest in the property within 30 days of the scheduled foreclosure sale and to the Tax Collector of the City or Town.

The foreclosure sale must be held on site of the property itself. The property will be sold to the highest bidder.

Borrowers have no rights of redemption.

NH Foreclosure Laws

New Hampshire is a non-judicial foreclosure state. The typical foreclosure timeline in the state is 60 days. Deficiency judgments are allowed.

Maine Overview

Pre-foreclosure Period

Before a foreclosure can begin, a lender must deliver a default notice to the borrower. If the borrower does not pay the full amount in default plus interest and fees within 30 days, the lender may start the foreclosure process by filing the appropriate documents in court. The lender also notifies the borrower of the foreclosure action. If there is no opposition by the borrower to the court action, there will be no hearing. If the borrower opposes the foreclosure, the case could go to trial.

If the court rules in favor of the foreclosing lender, the borrower has at least 90 days to keep the property and stop the foreclosure proceedings by paying all amounts due. Including these 90 days, the pre-foreclosure period usually lasts 6-7 months.

Notice of Sale /Auction

If the borrower does not stop the foreclosure during the pre-foreclosure period, the lender publishes a notice of sale for three weeks in a local newspaper. The sale is scheduled 30-45 days after the first publication date. The notice must contain the property description and the date, time, and location of the sale.

The sale is often at the office of the foreclosure attorney, who also runs the sale. Sales may also take place at the courthouse or the property. The sale may be postponed for no more than seven days at a time and the postponement will be announced at the originally scheduled sale. At the sale, the lender may bid on the property. The property is sold to the highest bidder. Usually bidders are required to bring a certain deposit amount (stipulated in the notice of sale) and may pay off the balance within 30 days. After the sale and payment of the balance, the lender transfers the property ownership to the winning bidder.

Maine Foreclosure Laws

Court foreclosures are most common in the state of Maine. The typical foreclosure process can take nine months.

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Although we believe that this information is accurate as it is compiled from professional sources, please verify this information on your own before relying on it as your only source of knowledge to base any decisions on.