How Foreclosure Works in Georgia

Why there is no court case

A Georgia security deed — the state's equivalent of a mortgage — conveys legal title to the lender and contains a power of sale. That power lets a lender sell the property at public auction after giving the required notice and advertising, without filing suit. In judicial-foreclosure states the same process takes many months of litigation.

The practical effect is speed. From the 30-day notice to the sale can be a little over a month, which is why acting early matters more in Georgia than in Florida.

The notice and the advertising

The advertisement is public, which is why owners in foreclosure in Georgia receive a flood of unsolicited mail and calls. None of that pressure should rush you into an agreement you have not read.

• Notice of the initiation of proceedings must be sent to the borrower at least 30 days before the sale, by registered or certified mail or overnight delivery with return receipt requested.
• That notice must include the name, address, and telephone number of the individual or entity with full authority to negotiate, amend, and modify all terms of the mortgage — usually the servicer.
• A copy of the published advertisement must accompany the notice.
• The sale must be advertised in the county's legal organ once a week for four weeks before the sale date.

The sale, and what follows it

Sales are conducted on the first Tuesday of the month at the county courthouse, by the party holding the power of sale or its attorney. The winning bidder receives a deed under power of sale.

There is no general statutory right of redemption after a Georgia mortgage foreclosure. Once the deed under power is delivered, the ownership interest is gone. That is a sharp contrast with a Georgia tax sale, where the owner generally has twelve months to redeem on payment of the price plus a 20 percent premium for the first year.

Deficiency requires confirmation

Georgia protects borrowers in one notable way. A lender that wants a deficiency judgment — the shortfall between the sale price and the debt — must apply to the superior court to confirm the sale, and the application has to be made within 30 days of the sale. The court examines whether the sale was properly advertised and conducted and whether the property brought its true market value.

If the lender does not seek confirmation, or the court refuses it, the deficiency generally cannot be pursued. That does not help you keep the house, but it is worth knowing when weighing your options.

Selling before the sale date

A sale that closes and funds before the advertised first Tuesday pays off the loan and stops the foreclosure. The closing attorney orders the payoff, the lender provides a figure with a good-through date, and the debt is satisfied from the proceeds. Any equity goes to you rather than being wiped out by the auction.

The constraint is time. Title examination, the payoff, and any probate or lien issues all have to finish before that Tuesday. Send us the date on your notice and we will tell you honestly whether a closing can be arranged in time rather than stringing you along.

Other options, all worth pursuing at once

• Call the servicer's loss-mitigation department and ask what reinstatement would cost.
• Contact the person named in your 30-day notice — Georgia requires the lender to identify someone with authority to modify the loan.
• Ask about modification, forbearance, or a repayment plan.
• Consider a short sale if the balance exceeds the value.
• Talk to a HUD-approved housing counselor. It is free and independent of any buyer.
• Bankruptcy can stop a sale but has long-term consequences and calls for a lawyer.

Frequently asked questions

This guide is general information, not legal, tax, or financial advice. Laws change and every situation is different, so talk with a qualified Georgia professional about yours.