Update: On March 18, 2020, Governor Laura Kelly signed Executive Order #20-06, which temporarily stops foreclosures in Kansas due to the coronavirus (COVID-19) outbreak. The order prohibits financial institutions from initiating foreclosure efforts or judicial proceedings. It also halts residential or commercial eviction efforts or judicial proceedings until May 1. The order is in effect until rescinded, May 1, 2020, or until the statewide State of Disaster Emergency proclaimed on March 12, 2020, relating to COVID-19 expires, whichever is earlier.
If you live in Kansas, and you’re behind on your mortgage payments, you might be wondering what happens during a foreclosure in your state. In Kansas, foreclosures are judicial, which means they go through court. You’ll find out that the bank has started a foreclosure when you receive a summons and complaint. Then, you’ll get a specific amount of time to file a response—called an “answer”—with the court.
In this article, you’ll learn about your legal rights during the foreclosure process in Kansas, including when foreclosure will start, how much time you get to respond to the complaint, how long you get to redeem the home after the foreclosure sale, and more.
Generally, federal law prohibits a loan servicer from beginning a foreclosure until the borrower is more than 120 days' overdue on the loan. (12 C.F.R. § 1024.41). During this time, you may submit an application to your servicer asking for an alternative to foreclosure. You might be able to keep your home by entering into a repayment plan or getting a loan modification, for example. Or you might be able to give up the home without going through a foreclosure in a short sale or deed in lieu of foreclosure.
Federal mortgage servicing laws also give other protections to borrowers who’re facing a foreclosure, including a prohibition on dual tracking.
To initiate a foreclosure in Kansas, the foreclosing bank files a lawsuit against the borrower and anyone else with an interest in the property. The borrower finds out about the suit through service of a summons and petition for foreclosure (also called a "complaint"). If the petition is personally served, the borrower gets 21 days to respond. (Kan. Stat. Ann. § 60-212). But if service is by publication, the borrower gets 41 days to respond. (Kan. Stat. Ann. § 60-307).
If you don’t file an answer, the bank may request—and probably get—a default judgment from the court. But if you file a response, the bank can’t get a default judgment. Instead, it will probably ask the court for summary judgment. The court will grant summary judgment for the bank if the facts of the case aren’t in dispute and you don’t have any valid defenses. But if the court denies summary judgment, then a trial may happen. If you lose at trial (or the court has granted summary judgment), the court will enter a final judgment of foreclosure against you and the court will order a sale. The bank must publish the notice of the sale in a newspaper. (Kan. Stat. Ann. § 60-2410).
“Reinstating” is when the borrower brings the loan current by paying the missed payments (principal and interest), plus fees and costs. Completing a reinstatement will stop the foreclosure.
Kansas law doesn’t provide a borrower with the right to reinstate the mortgage before the sale. But the terms of the mortgage you signed when you took out the loan might provide this right. Review your loan paperwork to find out if you get the right to reinstate and the deadline for doing so.
Some states allow the borrower to redeem the property within a specific period after a foreclosure. Under Kansas law, the redemption period is generally 12 months after the foreclosure sale, or less if a court finds that the homeowners abandoned the home. (Kan. Stat. Ann. § 60-2414(a)).
But if the borrower defaulted on the loan before paying off one-third of the original mortgage amount, the court will limit the redemption period to three months. The court may increase the redemption period by three months if the borrower loses his or her job during the initial three-month redemption period. (Kan. Stat. Ann. § 60-2414(m)).
Even if the borrower paid less than one-third of the mortgage loan, if all mortgages on the home total less than one-third of the market value of the property, the court will set a 12-month redemption period. (Kan. Stat. Ann. § 60-2414(m)).
Except for mortgages covering agricultural lands or mortgages covering single or two-family dwellings owned by or held in trust for natural persons owning or holding such dwelling as their residence, if the terms of the mortgage include a waiver, there is no redemption period. The loan contract may also provide for a shortened redemption period. (Kan. Stat. Ann. § 60-2414).
When the total mortgage debt exceeds the foreclosure sale price, the difference is called a deficiency. Some states allow the bank to seek a personal judgment—called a deficiency judgment—against the borrower for this amount. Other states prohibit deficiency judgments with anti-deficiency laws.
Deficiency judgments are generally allowed in Kansas. But if the court determines that the bid at the foreclosure sale was substantially inadequate it can refuse to confirm the sale. It can also fix a minimum or upset price. A sale for the full amount of the judgment, taxes, interest, and costs is considered adequate. (Kan. Stat. Ann. § 60-2415(b)).
Also, if service was by publication, then the foreclosing bank can't get a deficiency judgment—unless the borrower enters an appearance in the foreclosure, by filing an answer, for example. (Kan. Stat. Ann. § 60-307(b)).
If you want to learn more about the foreclosure process in Kansas or find out if you have any potential defenses to the action, consider talking to an attorney. It’s also a good idea to make an appointment to speak to a HUD-approved housing counselor, especially if you want to learn about different foreclosure alternatives.