The primary instrument of security in Pennsylvania is the mortgage lien. This indicates that the property provides the security for the loan, and as such a judicial foreclosure is required in the case of a delinquent loan. The lender is therefore required to approach the court for an order to repossess the property. Once this has been affected the property is sold at a public auction which is officiated by the Sheriffs office of the county in which the property is situated.
The court which has jurisdiction over foreclosures is known as the “Court of Common Pleas”, and these a situated throughout all of the counties of Pennsylvania. Depending upon the court schedule a judicial foreclosure takes 120 days or more. The length of time can be even more protracted if the borrower contests the case or files for bankruptcy.
Borrowers are allowed 20 days in which to file an answer to the foreclosure complaint and 10 days before the default is entered. There also has to be a period of at least 30 days notice required before a sale is able to take place. According to Pennsylvania law two pre-foreclosure notices have to be sent to the borrower by certified mail, informing him of the default and advising them that they are entitled to assistance in the form of the Homeowners Emergency Mortgage Assistance Program. Government loans such as VA and FHA mortgages are subject to different applications of the law, and advice may be sought from the HUD.
Deficiency judgments are allowed and have to be instituted within 6 months of the sale of the property taking place. Rights of redemption are allowed and borrowers have a certain period of post-sale time in which to remedy the delinquent amount, as well as pay back-taxes and interest. Exercising redemption rights may also revitalize interest from junior lien holders.