These materials have been prepared by Hunt Leibert Jacobson, P.C. for informational purposes only and are not intended and should not be construed as legal advice. This information is not intended to create, and receipt of it does not constitute, a lawyer-client relationship. All readers should not act upon this information without seeking professional counsel.

WHAT YOU CAN EXPECT IF YOUR LOAN IS REFERRED FOR FORECLOSURE IN CONNECTICUT

If you have received notification from your mortgage servicer that your Connecticut loan has been referred to an attorney for foreclosure proceedings, you should anticipate the following events to take place.

You should have received a Notice that you may be eligible for emergency mortgage assistance payments under the provisions of the Emergency Mortgage Assistance Program (EMAP). This program is administered by The Connecticut Housing Finance Authority (Authority). The Notice you received will set forth the time frames you have to contact your mortgage servicer and/or the Authority to discuss a resolution or apply for assistance. Please read the Notice carefully. (See link for Mediation Request)

Upon receipt of your loan for foreclosure, we will order a title search of your property. The title search is conducted at the Town Recording office where your property is located and will disclose the date, volume and page that your Mortgage was recorded. The title search will also disclose any other liens (second mortgages, tax liens, water liens, judgment liens, etc) recorded against your property either before or after your mortgage which have not been released. This information is needed in order to prepare the foreclosure Complaint explained in greater detail below.

Upon receipt of the title search of your property, the foreclosure complaint will be prepared.

Attached to the front of the foreclosure Complaint is a Notice of the Availability of Foreclosure Mediation which went into effect on July 1, 2008 (See link for Notice Letter). Mediation is a process by which an impartial state employed mediator assists both the foreclosing party and you in reaching a voluntary negotiated agreement.

In Summary, the foreclosure Complaint identifies the date when you signed the Note and Mortgage, the entity to whom your mortgage may have been assigned or will be assigned, the current owners of the property and/or the obligors on the Note or Mortgage. The Complaint will also reflect a listing of any liens which are recorded either before or after the mortgage being foreclosed.

Any lien holders whose unreleased liens are recorded after the mortgage being foreclosed will be named as Defendants in the foreclosure action. By listing such lien holders as Defendants, and serving them (see below) they will be provided notice of the proceedings and an opportunity to participate in the foreclosure process.

If there are any unreleased liens which are recorded prior to the mortgage being foreclosed, those lien holders are not named as Defendants but will be listed as having a senior lien position.

The majority of the costs associated with a foreclosure action are incurred at the inception of or within a few weeks following the commencement of the foreclosure. Those expenses include but are not limited to, the title search, the Marshal fee, the Court filing fee and the Appraisal of your property. Legal fees, which are separate and apart from costs, will also accrue from the date we receive your file for foreclosure.

At any time during the foreclosure process if you or your attorney requests, you will be provided with reinstatement or payoff figures which can be requested via our automated request system by clicking here. If you would prefer we provide reinstatement or payoff figures to a third party (other than your attorney) we will need written authorization from you to permit us to do so.

Although the foreclosure has been commenced there may be alternatives to the foreclosure for which you may qualify. The following are typical but not exclusive examples of foreclosure alternatives you may want to discuss with your mortgage servicer or with our office to see if you qualify: Loan Modifications, Repayment Plans, Forbearance Agreements, Deed in Lieu of Foreclosure, Short Sale and Short Refinance, which are further explained by clicking here. You may also want to contact the State of Connecticut toll free hot line at 888-995-4673, or a HUD Approved Housing Counseling Agency at 800-569-4287 or Homeowner’s HOPE, a service of the nonprofit Homeownership Preservation Foundation at 888-995-4673.

Once the Complaint is prepared, the original is forwarded to a Connecticut State Marshal along with a Summons. The Marshal serves a true and attested copy of the Summons and Complaint upon each Defendant at their current abode or upon any authorized individual able to accept service on behalf of any corporate Defendants (such as second mortgages or judgment lien holders). It is not required in Connecticut to serve the foreclosure complaint on any Defendant by in hand service although this form of service is equally acceptable.

The Summons and Complaint will reflect the Superior Court which the case will be returnable to as well as a Return Date. This Return Date is not a court appearance date but rather an established timeframe in which to determine when the service upon all defendants must be completed as well as when the original Complaint must be filed with the Superior Court. Return Dates are always a Tuesday and are selected by the law firm preparing the Complaint.

Each Defendant has an opportunity to file an Appearance form (obtainable from the State of Connecticut judicial website, or at any Superior Court Clerk's office) on their own behalf if they are an individual (called a pro se appearance) or through attorney. The State of Connecticut 's judicial website (accessible at http://www.jud.state.ct.us./) is an informative and helpful tool which can be utilized to monitor the progress of the foreclosure as well as the next assigned hearing date. If you have filed a form of Appearance, our office will contact you to advise if we intend to proceed with any of the scheduled hearings.

You have an opportunity to appear in Court and express your position to the Court whenever a hearing is scheduled.

The attorney for the foreclosing Plaintiff may commence the filing of default motions against all Defendants within 2 days following the passing of the Return Date.

Defendants may be defaulted for any of the following reasons:

Default for Failure to Appear – meaning the Defendant has failed to file an Appearance in the foreclosure case and is not indicative of a Defendant's failure to attend a Court hearing.

Default for Failure to Plead – meaning the Defendant has failed to file with the Court a valid defense to the foreclosure action after the Defendant has filed an Appearance.

Demand to Disclose Defense – meaning an Attorney has filed an Appearance on behalf of a Defendant and Plaintiff is seeking to determine whether the defendant has any defense to the foreclosure action.

Default for Failure to Disclose Defense – meaning the Attorney has failed to disclose a valid defense to the foreclosure within 5 days from the filing of the Demand to Disclose Defense by the Plaintiff or the Attorney has filed a Disclosure of No Defense

In order to enter a judgment, the Court requires the Plaintiff to obtain an appraisal report in order to determine the fair market value of your property. The fair market value of the property is used by the Court to determine whether a Judgment of Foreclosure By Sale or a Strict Foreclosure will enter (discussed further below).

Simultaneously with or after filing the default motions, a Motion for Judgment of Strict Foreclosure will be filed with the Court. Attached to it will be a copy of the appraisal and the preliminary statement of the debt. A copy of the Motion for Judgment of Strict Foreclosure and attachments will be mailed to all Defendants who have filed a notice of Appearance. The Court will schedule a hearing on the Motion for Judgment of Strict Foreclosure in approximately two weeks after receipt. Foreclosure hearings are scheduled on Mondays in the Superior Court (unless a Monday is a legal or judicial holiday which will cause the hearing to be scheduled on a Tuesday).

You have an opportunity to appear in Court and express your position to the Court whenever a hearing is scheduled.

At the hearing on the Motion for Judgment, the Court establishes the following:

• The fair market value of the property based on the appraisal submitted by the Plaintiff or based on an appraisal submitted by a defendant
• The amount of the Plaintiff’s debt based on the Affidavit of Debt submitted by the Plaintiff
• A finding of the attorney fee and allowable costs for the title search and appraisal
• The sale date or Law Day ( redemption date) depending on the Courts discretion and determination of equity based on a finding of the debt, fair market value, prior liens, attorney fees, title search fees and appraisal fees. (as further explained below)

Typically speaking but not always, if there is less then $10,000.00 in equity in the property, the Court will enter a Judgment of Strict Foreclosure.

If a Judgment of Strict Foreclosure is set by the Court, a Law Day will be assigned. The assignment of the law day is at the Judge’s discretion but can be no sooner than 21 days from the date of the hearing. In most instances, the law days are set between 30-60 days from the date of the hearing. You as the borrower and owner of the property are assigned the first law day. You have until your law day to either bring your loan current (with Plaintiff’s permission) or pay off and satisfy the judgment entered by the court with accruing interest plus attorney fees and costs awarded by the Court. If you do not pay off the judgment by your assigned Law Day, your ownership interest in the property will be foreclosed out.

Each other Defendant is also assigned a law day in their inverse order of priority. This law day provides each Defendant an opportunity to redeem (or satisfy) the Plaintiff’s debt and obtain title to the property. If no party redeems, title to the property vests in the name of the foreclosing Plaintiff following the last law day. At this point, the foreclosure is completed and evidence of the transfer of title will be document by the recording of a Certificate of Foreclosure on the Land Records of the town where the property is located.

Generally if there is equity in excess of $10,000.00 or if there is a Federal lien recorded against the property (unless the holder of the Federal lien agrees otherwise), the Court at its discretion will enter a Judgment of Foreclosure by Sale. The scheduling of the foreclosure auction date is at the Judge’s discretion but is usually set for 60-90 days from the date of the judgment hearing. Should a Judgment of Foreclosure by Sale enter, there will be an actual auction held at your property on the date and time established by the Court at the judgment hearing. Typically Foreclosure Sales are held on Saturdays.

The Court will appoint a third party Committee for Sale (which is an attorney licensed to practice in the State of Connecticut) who will conduct the foreclosure auction. The Committee will be responsible for ordering and placing a sign on the property, publishing an advertisement in a newspaper listing the terms of the sale, obtaining liability insurance for the date of the sale and communicating with any interested bidders as well as conducting the auction on the date of the sale. Payment of the Committee fees and expenses (which can run upwards of $5,000.00 or more) are the responsibility of the successful bidder at the auction. If the sale is canceled because of a loan workout any Committee’s fees and costs incurred must still be paid.

Once the foreclosure auction is conducted, the Committee will file its Motion for Approval of the Sale, Deed, Fees and Expenses. The Court will schedule a hearing on these Motions and issue its ruling thereon. You have an opportunity up until the date the Court approves the sale to either bring your loan current (with Plaintiff’s permission) or payoff the judgment with accruing interest, attorney fees, court costs and Committee fees and costs.

You have an opportunity to appear in Court and express your position to the Court whenever a hearing is scheduled.

If the Plaintiff is the successful bidder at the auction, and the court approves the sale, then they must pay the Court awarded fees and expenses of the Committee for Sale in order to obtain the Committee’s Deed. Once payment is received, the original Committee Deed will be provided by the Committee and recorded on the Land Records in which the foreclosed property is located. This will essentially conclude the foreclosure action and the Plaintiff will now be the record title holder of the property.

If a third party was the successful bidder at the auction and the court approves the sale, then the Committee for Sale will forward the high bidder’s deposit to the Clerk of the Superior Court to be held on deposit. The high bidder is required to pay to the Committee the remaining amount of the bid approved by the Court (less the deposit previously tendered) within 30 days of the approval of the sale by the Court. The deposit and remaining amount of the successful bid are collectively referred to as the Sales Proceeds. Once the Committee receives the remaining sale proceeds, the successful bidder will be provided with the original Committee Deed by the Committee and will become the record title holder of the property.

The Committee will then forward the remaining proceeds to the Clerk of the Superior Court to be held on deposit. In order to obtain the Sales Proceeds, the Plaintiff must file a Motion for Supplemental Judgment which will allow for the distribution of said proceeds. Upon receipt of the Motion, the Court will schedule a hearing. Upon approval and following a 20 day appeal period, the Clerk of the Court will issue a check to the Plaintiff. Should there be any additional sums on deposit with the Court after payment of the Plaintiff’s debt, it will be the responsibility of each Defendant (or you) to you to file their own Motion for Further Supplemental Judgment to obtain any amounts owed to them. The Court will determine the amount each subsequent lien holder or you are entitled to.

The party who acquires title to the property being foreclosed (whether by Strict Foreclosure or Foreclosure by Sale) can request through the Court an order of Ejectment. An Ejectment will allow that party with the assistance of a State Marshall to remove any occupants living in the property along with their possessions who were named in the foreclosure proceedings.