Louisiana foreclosures are typically completed through what’s called an "executory proceeding," which is a process that allows a lender to seize and sell a home without having to go through the normal steps required in a typical judicial foreclosure. If you want to learn more about this type of Louisiana foreclosure, what type of notice you’ll get before the foreclosure sale, whether the foreclosing party can get a deficiency judgment after the foreclosure, and more, keep reading. Below you’ll find a rundown of some of the important parts of Louisiana foreclosure law along with citations to the statutes so you can read the law yourself.
In Louisiana, the most common foreclosure process is called an "executory proceeding." This type of foreclosure is possible when, in the mortgage documents, the borrower agrees to a judgment against him or her—called a "confession of judgment"—upon a default.
So, upon a default, the foreclosing party files a foreclosure petition in court, with the mortgage attached, and the court orders the property seized and sold. The homeowner can fight the foreclosure only by appealing or bringing a lawsuit. (La. Code Civ. Proc. Ann. art. 2634, 2638).
Ordinary judicial foreclosures are also possible in Louisiana, but not common. (La. Code Civ. Proc. Ann. art. 3722). Because the most common type of foreclosure process in the state is an executory proceeding, this article focuses on that process.
There are two notices in a Louisiana executory proceeding: a notice of seizure and a notice of sale.
Notice of seizure. Immediately after the court issues a writ of seizure and sale, the sheriff may seize the property. The sheriff must serve the borrower a written notice of seizure by personal service or domiciliary service. (La. Code Civ. Proc. Ann. art. 2721). (Domiciliary service is when the server leaves the documents at your home with a person of suitable age and discretion who resides in the home.)
The notice of seizure must include information about the homeowner's options for avoiding foreclosure, including the availability of free housing counseling, as well as the time, date, and place of the sheriff's sale. The initial sheriff’s sale date can't be scheduled any earlier than 60 days from the date the court signed the order allowing the foreclosure. (La. Rev. Stat. § 13:3852, La. Code Civ. Proc. Ann. art. 2293(B)(1)).
Notice of sale. At least three days, not including holidays, after the sheriff serves the notice of seizure upon the borrower, the sheriff must publish a notice of sale at least twice. (La. Code Civ. Proc. Ann. art. 2331, 2722).
“Reinstating” is when you catch up on the missed loan payments, plus fees and costs, in order to stop a foreclosure.
Louisiana law doesn't give the borrower the right to reinstate the mortgage loan before the sale. But the terms of the mortgage contract may permit reinstatement or the foreclosing party might agree to let the borrower cure the default and reinstate.
Some states allow the borrower to redeem the home within a certain period of time after the foreclosure. In Louisiana, the foreclosed homeowners don't get the right to redeem following the foreclosure.
When the total mortgage debt exceeds the foreclosure sale price, the difference is called a "deficiency." Some states allow the foreclosing party to seek a personal judgment, which is called a "deficiency judgment," against the borrower for this amount, while other states prohibit deficiency judgments with what are called anti-deficiency laws.
There is no anti-deficiency law in Louisiana. The foreclosing party can get a deficiency judgment if the property was appraised before the sale. (La. Code Civ. Proc. Ann. art. 2771, 2723).
To obtain a deficiency judgment, the foreclosing party must file a separate lawsuit for the deficiency after an executory proceeding or convert the executory proceeding into an ordinary proceeding. (La. Code Civ. Proc. Ann. art. 2772). (Learn how lenders collect deficiency judgments.)
Once the sheriff’s deed is recorded after the sale, the purchaser can get a writ of possession from court. If the former homeowners don't leave, the sheriff will remove them and their belongings from the home.
If you have questions about the foreclosure process in Louisiana or want to learn about potential defenses to a foreclosure, consider talking to a foreclosure lawyer. 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 loss mitigation (foreclosure avoidance) options.