Both judicial, or in-court and non-judicial, out of court, foreclosure processes are followed in Oklahoma.
The deciding factor in which process will be used is the power of sale clause.
Should the mortgage or deed of trust contain power of sale clause, then the bank can pursue the foreclosure process without going before a judge.
The banks will always follow this option if they have it, because it saves them both time and money to do so.
Most mortgage or deeds of trust have power of sale clause written into them.
So this means that most foreclosures will be conducted in the out of court way.
To follow the judicial process of foreclosure, the bank must file a lawsuit to obtain court order to foreclose, in order to move on to the auction of the house.
The auction is commonly referred to as the trustee sale.
One little interesting point of Oregon law is that the borrower has waived the right to an appraisal in the mortgage, then the property must be appraised before it can be sold at the trustee sale.
The amount of this appraisal sets the bar, in how much the home can be sold for.
The house cannot be sold for anything under two thirds of that appraised value.
Power of sale clauses can specify the time, place and terms of the trustees sale.
If this is the case, then those instructions must be followed.
Most cases are not micromanaged in this way, however.
In the majority of out of court foreclosures, the process begins with a written notice of intent to foreclose being mailed to the home owner who is in default on his loan.
This letter must be sent to the last known address of the home owner.
This letter must describe the defaults of the borrower.
This letter also announces that this homeowner has thirty five days from the date the letter was sent to come current on the loan.
If the home owner can do this the foreclosure sale will be stopped.
If, however, this is the third time the homeowner has been in default, then the bank is not required to send this letter again.
Additionally, if there have been four defaults in the past twenty four months, no additional notices are needed or required to be sent.
A letter called the notice of sale must be recorded with the county in which the home is located sometime before ten days have past, since the expiration of the thirty five day time frame stated in the letter.
This notice of sale must be advertised in a local paper with circulation in the county where the home is located.
This ad must be run once a week for four consecutive weeks.
The first of these ads must start being placed no less than thirty days before the scheduled sale date.
This ad or notice, must include the names of the bank, the homeowner and the place and time of the sale.
It must also include a description of the property including the street address.
The home will be awarded to the person offering the highest bid at the auction.
Anyone who is the winning bidder at the sale must have cash or certified funds equal to ten percent of the winning bid amount.
If the person making the highest bid does not have those funds with them at the sale, the home will then be awarded to the next highest bidder.