Nebraska has one of the lowest foreclosure rates in the nation. Still, if you’re one of the homeowners facing a foreclosure in the state of Nebraska, you most likely have several questions about what will happen and what your rights are during the process. For instance: What type of notice will you get? Will you have the right to reinstate your loan by catching up on the past-due amounts? Is it possible to reclaim the home after the foreclosure by redeeming it? Can your lender get a deficiency judgment after the foreclosure in Nebraska?
For answers to these questions, and others, read on. You’ll find a summary of some of the key parts of Nebraska’s foreclosure law along with citations to the statutes so you can read the law yourself.
The laws that govern Nebraska foreclosures are:
You can find a link to the Nebraska Revised Statutes on the Nebraska legislature’s website at http://nebraskalegislature.gov/laws/laws.php. If you need help finding the statutes, see Finding Your State’s Foreclosure Laws.
We’ve summarized some of the important parts of Nebraska’s foreclosure laws below. You can find more detailed articles on various aspects of Nebraska foreclosure law in Nolo’s Nebraska Foreclosure Law Center.
The majority of foreclosures in Nebraska are nonjudicial, which means the foreclosure takes place outside of court. (Judicial foreclosures, which go through the court system, are also possible, but are less common). Since most foreclosures in Nebraska are nonjudicial, this article focuses on that process.
Nebraska law requires two foreclosure notices: a notice of default and a notice of sale.
Notice of default. To start a nonjudicial foreclosure, the trustee (the third party that administers nonjudicial foreclosures in Nebraska) records a notice of default in the recorder's office in the county where the property is located. The notice gives the borrower one month to cure the default. (The borrower gets two months if the property is agricultural.) Neb. Rev. Stat. § 76-1006.
Notice of sale. After at least one month, the trustee publishes a notice of sale in a newspaper for five successive weeks. Neb. Rev. Stat. § 76-1007.
Mailing requirements. The trustee must send a copy of the notice of default and notice of sale to anyone who previously filed a request for notice in the county records. Neb. Rev. Stat. § 76-1008.
In Nebraska, a deed of trust must contain what’s known as a “request for notices” provision. Neb. Rev. Stat. § 76-1008. Under this provision, it is as though the trustor (the person who signed the deed of trust) filed a separate request for notice in the county records. This means that the trustee must mail a copy of the notice of default and notice of sale to each trustor. (Learn about the difference between a mortgage and deed of trust.)
The trustee must mail a copy of the notice of default to the trustor within ten days after recording it. The notice of sale must be mailed at least 20 days before the foreclosure sale date. Neb. Rev. Stat. § 76-1008.
“Reinstating” is when you catch up on the missed payments (plus fees and costs) in order to stop a foreclosure. (Learn more about reinstatement to avoid foreclosure.)
Borrowers in Nebraska can reinstate within one month (or two months, if the land is agricultural) after the trustee records the notice of default. Neb. Rev. Stat. § 76-1012.
In some states, you can redeem (repurchase) your home within a certain period of time after the foreclosure. Under Nebraska law, foreclosed homeowners cannot redeem the home after a nonjudicial foreclosure. Neb. Rev. Stat. § 76-1010. (To get details on redemption after a foreclosure in Nebraska, see Nolo’s article If I lose my home to foreclosure in Nebraska, can I get it back?)
When the total mortgage debt exceeds the foreclosure sale price, the difference is called a “deficiency.” Some states allow the lender to seek a personal judgment (called a “deficiency judgment”) against the borrower for this amount, while other states prohibit deficiency judgments with what are called anti-deficiency laws.
In Nebraska, the foreclosing party may obtain a deficiency judgment by filing a lawsuit within three months after the foreclosure sale. The amount of the deficiency judgment is limited to the lesser of:
If the foreclosed homeowner doesn’t leave the property after a Nebraska foreclosure sale, the new owner must go to court and get an eviction order.