A sheriff's sale is the culmination of a court-ordered, months-long judicial foreclosure process that begins when a homeowner becomes delinquent on a loan and the lender files a foreclosure lawsuit in court. Generally, lenders initiate foreclosure when a property owner is 60 days in arrears or more, although some lenders wait longer or act more quickly. While the foreclosure process can be a difficult and frightening experience for a delinquent homeowner, it doesn't always have to end with the court-ordered sale of a property. Property owners in Pennsylvania can stop a sheriff's sale up to one hour before the foreclosed property is scheduled for sale if they have the money to pay off the entire mortgage balance, if they seek a continuance or if they file for bankruptcy.
You can stop a sheriff's sale by paying off the mortgage balance, including late fees, or if you file bankruptcy before the sale occurs. You can also seek to have the sale moved to a later date by contacting the sheriff's office with a copy to the mortgage company's attorney.
Paying Arrears and Foreclosure Fees
The homeowner must pay the the mortgage arrears, plus late fees and foreclosure costs to stop a sheriff sale. These can add several tens of thousands of dollars to past-due loan payments already owed. The charges the lender can assess include property inspection fees, property preservation costs and corporate advance costs, in addition to foreclosure fees. Some states limit the amount of foreclosure fees a lender may assess. In Pennsylvania, a Fannie Mae lender may not charge foreclosure attorney fees in a non-judicial foreclosure. However, the lender can assess up to $2,800 in a judicial foreclosure on a Fannie Mae loan.
The sheriff's office will be able to provide the property owner with the exact amount needed to pay off the balance, including applicable late fees.
Contact the Sheriff's Office
A sheriff's sale can be stopped up to an hour before the sale begins – but only if the homeowner has the funding and lets the sheriff know the required monetary amount is in place. Time is of the essence. Once the money is in place, the property owner should contact the sheriff's office as soon as possible to let them know that the balance will be paid off. This is an important step, because once a sale has ended, property owners lose rights and have no legal recourse to resume ownership.
Even if you aren't able to pay right away, many counties permit a homeowner to request one or more continuances of the sheriff sale. You can contact the sheriff's office and ask that the sale be postponed. If it's been postponed multiple times already, the sheriff might not agree.
Sheriff Sales Differ by County
Sheriff sale proceedings can vary by county. For example, the Philadelphia County Sheriff has a different sheriff sale procedure than the Allegheny County Sheriff. Different jurisdictions may also have different requirements for stopping or postponing the sale. Pennsylvania is a judicial foreclosures state in which the courts oversee the foreclosure proceedings that lead up to a sheriff's sale. This is different from a non-judicial foreclosure state, such as California, where lenders do not need court oversight and approval to auction a foreclosed home.
A sheriff sale follows a judicial foreclosure after the lender has provided the state-required notices of default and foreclosure proceedings as well as outlines the homeowner's options for stopping the sale. The court then gives the lender permission to foreclose, at which point, the lender contacts the local sheriff's office to secure the property and auction it.
Pay Up or Postpone
You will need documentation or a receipt showing that the delinquent loan has been paid off. This documentation is the homeowner's proof that she is not liable for mortgage debt, the home is no longer in foreclosure and the balance has been satisfied.
If a homeowner can't afford to repay the entire debt or at least the mortgage arrears and penalties, then a sheriff sale continuance or adjournment may stop the sale. A sheriff sale may be postponed as late as one hour before the sale is scheduled. However, the exact amount of time a homeowner has to file a petition to postpone the sale depends on the jurisdiction. For example, Philadelphia homeowners have until the day before the sheriff's sale to file a petition, although the court may look more favorably upon a petition filed at least a week in advance. Homeowners may also have to provide a valid reason for waiting until the last week to file a petition to postpone.
Bankruptcy Filing Stops Sale
Filing for bankruptcy could stop the sheriff sale if you file it on time and you can cure the mortgage arrears. Consulting an attorney right away for an automatic stay before the sale starts can prevent the sheriff sale. An automatic stay is an injunction which bars creditors, including mortgage lenders, from moving forward with debt collection. If the sale has already started, a bankruptcy filing is too late. Additionally, a lender may ask the court to lift an automatic stay and the sheriff's sale can proceed.