| Answers |
How are mortgage liens treated in Pennsylvania?
Pennsylvania is known as alien theory state where the property acts as security for
the underlying loan. The document that places the lien on the property is called amortgage.
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How are Pennsylvania mortgages foreclosed?
In Pennsylvania, thelenders go to court in what is known as ajudicial foreclosure
proceeding where the court must issue a final judgment of foreclosure. The property is then sold as part of a publicly
noticed sale. The court with jurisdiction over a foreclosure is known as theCourt of Common Pleas in the County
in which the property is located. A complaint is filed with theprothonotary in this court along with what is
known alis pendens. Alis pendens is a recorded document that provides public notice that the property
is being foreclosed upon.
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What are the legal instruments that establish a Pennsylvania mortgage?
The documents are known as themortgage,note, and in a commercial transaction, asecurity agreement.
Sometimes the mortgage document is combined with the security agreement. Amortgage is filed to evidence the
underlying debt and terms of repayment, which is set forth in thenote.
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How long does it take to foreclose a property in Pennsylvania?
Depending on the court schedule, it usually takes approximately 120 days or more to effectuate an uncontested foreclosure.
This process may be delayed if the borrower contests the action, seeks delays and adjournments of hearings, or files forbankruptcy. Adefendant has 20 days in which to file ananswer to aforeclosure complaint
otherwise default will be entered. The defaulting borrower must be given at least 10 days notice before default is entered
and there must be a 30 day notice before a foreclosure sale can take place by the Sheriff. There are twopre-foreclosure
notice requirements which are specific to Pennsylvania. An Act 6 notice (Required to be sent by certified Mail) requires
a notice of intention to foreclose to be sent within 60 days of a default occurring. The borrower will usually then
have 30 days in which to set up a payment plan or cure any default during this time frame. An Act 91 notice (Required to be
sent by regular mail with certificate of mailing) relates to a mortgage default where the borrower is advised there may be
assistance available in the form of a HEMAP (Homeowners Emergency Mortgage Assistance Program) loan to cure the existing
default. Act 6 and Act 91 notices have different applications to various government guaranteed loans. FHA loans under $50K
in default usually require Act 6 notice and VA/Conventional loans under $50K require Act 91 notices.
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Is there a right of redemption in Pennsylvania?
Pennsylvania does not have a post-salestatutory right of redemption, which allows a party whose property has been
foreclosed to reclaim that property by making payment in full of the sum of the unpaid loan plus costs.
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Are deficiency judgments permitted in Pennsylvania?
Yes. Adeficiency judgment may be obtained when a property in foreclosure is sold at a
public sale for less than the loan amount which the underlying mortgage secures. This means that the borrower still
owes the lender for the difference between what the property sold for at auction and the amount of the original loan.
Deficiency actions must be brought within six (6) months of the foreclosure sale.
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What statutes govern Pennsylvania foreclosures?
The laws that govern Pennsylvania foreclosures are found in Pa. R.C.P. 1141-1164 (Actions to Foreclose a Mortgage),
3180-3183 (Judgments in Mortgage Foreclosure), and 8103 et. seq. (Deficiency Judgments) (These are civil procedure rules).
The Loan Interest & Protection Law, 41 P.S. §101 et. seq. (Act 6) and the Homeowners Emergency Assistance Act,
35 P.S. § 1680.401 et. seq. (Act 91) are the statutory references.
http://www.pacode.com/secure/data/231/chapter1000/subchapItoc.html
http://members.aol.com/DKM1/41.Cp.4.html
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