do state income tax liens survive foreclosure

The “power of sale” clause lets the trustee for a deed of trust sell the property. This may involve recording a Notice of Default with the county recorder, but there is no need to get a court’s blessing. In a deed of trust state (such as Maryland, Michigan, Virginia, West Virginia, or Tennessee), the lender simply sends a default letter to the borrower. When a lender has to use the court system to foreclose (as in Delaware, Kentucky, Ohio, Illinois, Pennsylvania, and New Mexico), it’s a more complex process and takes longer for the lender to carry out. Other states primarily use deeds of trust and can foreclose out of court.

Some states use mortgages and must go through the court’s foreclosure process. If a borrower stops paying, the mortgage lender will call the borrower, send a paper notification, and file the necessary paperwork to foreclose on the home. Given that a lender can evict a borrower, the meaning hasn’t changed all that much in 800 years! Mortgage? Or Deed of Trust? In today’s legal terminology, it means taking over a home that’s collateral for a mortgage. It’s from the early French word forclos, meaning to exclude, shut out, or drive away. That said, foreclosures can occur when a home loan becomes just too much of a financial burden, and the owner simply cannot or will not make the payments any more.įoreclosure is a term that dates back to the 1200s. It’s hard to make any blanket statements about dealing with the process, as it varies so much from state to state - and even from county to county. When the economy is brutal, foreclosures become more common.

Do state income tax liens survive foreclosure