I. Default – A default is simply a breach of the terms of your Note and/or Mortgage – typically a failure to make payments.
II. Notice of Default/Intent to Accelerate – Most of the standard form Notes and Mortgages used for residential properties permit a lender to call the entire balance due, also know as “accelerate the loan,” but require the lender to give advanced notice and an opportunity (typically 30-35 days) to pay the past due amounts.
III. Complaint Filing and Service – Ohio law requires the lender “Plaintiff” to file a law suit which is done through the filing of a “Complaint.” A complaint is a legal document that alleges facts which, if proven to be true, would allow the lender to obtain judgment. Foreclosure complaints, along with a “Summons,” are required to be “served” on all named Defendants to provide notice of the law suit and the need to appear and defend.
IV. Responses to the Complaint – Within 28 days of receiving service of the Summons and Complaint, Defendants may file an “Answer” which responds to the allegations of the Complaint and also states specific defenses; or they may file a Motion seeking additional clarification or requesting that the Complaint be dismissed. A Defendant’s Answer may also include “Counterclaims” against the Plaintiff, “Cross-Claims” against other named Defendants, or “Third-Party Claims” against people who were not named in the Complaint if appropriate.
V. Discovery – Discovery is perhaps the most valuable and most expensive phase of litigation. It provides the parties with an opportunity to fully investigate their claims, and to gather crucial evidence for use at judgment.
VI. Motions for Judgment – Possible Right of Appeal – If a defendant fails to file an answer, the plaintiff may be entitled to “default judgment” whereby the allegations of the complaint are presumed to be true. Where an appropriate answer has been filed, “summary judgment” requires the submission of additional evidence proving there are not factual issues requiring trial.
VII. Trial – Right of Appeal – Trial provides the opportunity to present evidence, to question witnesses, and to submit arguments in open court.
VIII. Sale – Where a foreclosure judgment has been granted, the judgment holder may file a praecipe with the Clerk of Courts asking that the property be appraised, advertised, and sold at a sheriff’s auction. In most circumstances, the minimum bid is set at two-thirds (2/3) of the appraised value.
IX. Confirmation of Sale – Right of Appeal – Once the property has been sold, the Court must review the sale process to confirm whether the proceedings were conducted in substantial compliance with Ohio Law. The Confirmation of Sale terminates a homeowner’s right to “redeem” the property.
X. Writ of Possession (Eviction) – The Confirmation Entry typically includes a “writ of possession” allowing the purchaser to file a praecipe with the Clerk of Courts to have the Sheriff complete an eviction and place the purchaser in possession of the real estate.