The foreclosure process in Oklahoma is often confusing and frightening to anyone who experiences it for the first time. There are a few things to remember. 

First, there are almost always options, particularly if you get help early in the process. Second, there are resources available. Finally, providers of legal services are catching up to the big lenders in terms of being able to prevail in Court on issues involving unfair and predatory practices. 

The actual foreclosure process begins before the lawsuit is ever filed. The members of the lending industry have set up a system where foreclosure debts are sold or transferred electronically, without actually transferring the paper that was signed by the borrower. Mortgage lenders have created a corporation called MERS (Mortgage Electronic Registration System) that keeps track of all the transfers. When a lender decides to initiate foreclosure proceedings, MERS determines who actually owns the note and starts the paperwork to transfer that paper to the actual owner of the note. Many times, lenders would start the foreclosure proceeding before the notes were signed transferring the debt to the foreclosing party. In Oklahoma, this is strictly prohibited. 

The first step in the actual foreclosure process is the filing of a petition in the County in which the property is located. Notice must be given (by serving a copy of the petition and a Summons) to any person or company that may claim an interest in the property. This includes the owner(s), anyone with a lien or mortgage on the property, the Homeowners Association or renters. Getting every Defendant served with the appropriate paperwork often takes time, and affords a window of opportunity to act. 

A party who is served has 20 days from the date of service to file a written Answer to the Petition, and an additional 20 days can be reserved if the first response is filed within the first 20 days. Many Defendants make the mistake of letting this deadline pass without filing an Answer, and Defendants also need to realize that even if the deadline passes, there are still possibilities to get an Answer on file. It is essential to consult an attorney as soon as possible after being served, or upon learning that a foreclosure action has been filed. The most common mistake Defendants make is failing to consult an attorney for fear of the cost. Many attorneys offer a free initial consultation which can be very enlightening, and often will dispel many fears. if the Defendant is truly without resources, he or she may qualify for Legal Aid.  

Any Defendant that fails to file an Answer waives the right to be informed of future proceedings. This means that after being served, months could go by with no indication of what is happening, followed by the unannounced arrival of Sheriff's Deputies ready to forcibly remove the borrower from the property. Even if the borrower has no defense, it is important to file an Answer so that the borrower is entitled to notice of everything taking place up to the moment the authorities arrive. 

After all Defendants have either answered, or let the Answer deadline pass, the matter moves into the "Discovery" phase. In many ways, this is the most critical phase of the litigation. This is the stage where the borrower, through his or her attorney, can obtain documents and information from the person bringing the foreclosure action. The borrower's attorney has the ability at this stage to determine if the Plaintiff is the actual person or company entitled to bring the foreclosure action, and whether the Plaintiff completed all of the actions that are required prior to filing a foreclosure action. In some cases, the foreclosure action will be dismissed outright. In other cases, the litigation will be placed on hold long enough to allow the borrower to make arrangements to reinstate the mortgage, or take advantage of remedies through the Bankruptcy Code. Look for an attorney with a good working relationship with a local Bankruptcy Attorney. 

While a qualified Foreclosure Defense Attorney may be able to secure real relief in many cases, there will still be many cases where the Plaintiff will survive the Discover Phase, and the case will move to ultimate foreclosure. In these cases, there may be little more that can be done, except make sure that all steps are carried out in full compliance with the law. The final steps are: 

Judgment; Where the Court determines who is liable for the repayment of the amounts due on the note, the priority of the lienholders, and who is entitled to possession of the property; 

Sheriff's Sale; The property must be appraised by three landholders in the County, and the sale price can be no less than 2/3 of the appraised value. An attorney can use available resources to contest the appraised value, which is often often generated by a panel of 3, chosen from the Sheriff's list of approved appraisers; 

Confirmation of the Sheriff's Sale; This is the final "drop dead" deadline. At any point prior to the Confirmation, the borrower may "redeem" the property by paying the full amount of the judgment and court costs. Once the sale is confirmed, the Plaintiff becomes the owner of the property, unless the Plaintiff executes an assignment to FNMA or HUD; 

Writ of Assistance; Unless the Confirmation Order grants the borrower an amount of time to vacate, at any time after the Confirmation Order, the Plaintiff may obtain a Writ (Order) directing the Sheriff to dispossess (evict) the occupants of the property; 

Deficiency; Within 30 days of the Order Confirming the Sheriff's Sale, the Plaintiff can ask the Court for a Judgment for "deficiency" (the difference between the judgment amount and the purchase price at the Sale). Oklahoma has an "anti-deficiency" statute that will provide at least some protection at this point.

If you have additional questions, you should consult a real estate attorney in your area.  If you are facing foreclosure or have questions in Tulsa or Wagoner County, you can e-mail me or call (918) 258-2711.