Does Mississippi Allow Deficiency Judgments?
Full Question:
Answer:
From what you have described, the property has already been sold through foreclosure. A debtor may pay the past due amount and stop the foreclosure process provided the payment is made prior to the foreclosure sale and all costs and fees are paid in full. An account in foreclosure may be reinstated and the foreclosure stopped at any time before the conclusion of the sale at the courthouse, provided all past-due payments, late charges, expenses of sale, attorneys’ fees, and trustee’s fees are paid in full, in cash or certified funds. [Miss. Code Ann. 89-1-59 (1972)] After the sale is concluded, the sale is final, and no statutory post-sale right of redemption exists.
Ordinarily, a deficiency suit would be filed in circuit or county court in the county of residence of the obligors under the provisions of the deed of trust note. A legal action seeking a deficiency must be filed within one year of the sale date; otherwise recovery is forever barred by the statute of limitations. Upon filing suit, the defendants have 30 days from the date of service of the papers within which to answer the complaint. If no answer is filed on time, the lender is entitled to win a judgment for the amount sought.
If a mortgagee intends to enter a bid less than the amount owed at a foreclosure sale, so as to create a deficiency, if accepted as the highest bid, it must pass judicial standards of reasonableness. According to decisions of the Mississippi Supreme Court, bid amounts should be 51 percent or more of the property’s fair value.
See aldo:
http://www.underwoodlawfirm.com/id5.html
The following is a MS statute:
§ 89-1-59. Accelerated debt may be reinstated by payment of all default before sale.
Where there is a series of notes or installment payments secured by a deed of trust, mortgage or other lien, and a provision is inserted in such instrument to secure them to the effect that upon a failure to pay any one (1) note or installment, or the interest thereon, or any part thereof, or for failure to pay taxes or insurance premiums on the property described in such instrument and the subject of such lien, that all the debt secured thereby should become due and collectible, and for any such reason the entire indebtedness shall have been put in default or declared due, the debtor, or any interested party, may at any time before a sale be made under the terms and provisions of such instrument, or by virtue of such lien, stop a threatened sale under the powers contained in such instrument or stop any proceeding in any court to enforce such lien by paying the amount of the note or installment then due or past due by its terms, with all accrued costs, attorneys' fees and trustees' fees on the amount actually past due by the terms of such instrument or lien, rather than the amount accelerated, and such taxes or insurance premiums due and not paid, with proper interest thereon, if such should have been paid by any interested party to such instrument. Any such payment or payments shall reinstate, according to the terms of such instrument, the amount so accelerated, the same as if such amount not due by its terms had not been accelerated or put in default.
After the sale is concluded, a separate action may be brought to recover the deficiency between the total indebtedness secured by the deed of trust and the proceeds resulting from the foreclosure sale, provided the bid amount meets certain standards of reasonableness.
