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Vermont Foreclosure Law Summary
WHAT IS A SHORT SALE
Quick Facts
WHY USE SHORT SALE US
- Judicial Foreclosure Available: Yes
SUCCESS STORIES
- Non-Judicial Foreclosure Available: Yes
WHO QUALIFIES FOR A SHORT SALE
- Primary Security Instruments: Deed of Trust, Mortgage
FAQs
- Timeline: Typically 210 days
SHORT SALE NEWS
- Right of Redemption: Yes
VALUE YOUR HOME
- Deficiency Judgments Allowed: Yes
STATE FORCLOSURE LAWS
In Vermont, lenders may foreclose on mortgages or deeds of trust in default
CONTACT US using the strict or the power of sale foreclosure process.
HIRE US Strict Foreclosure
The strict foreclosure process is based on the premise that the lender owns
the property until the mortgage has been paid in full. If the borrower breaks
any of the conditions established in the mortgage prior to the time the loan is
paid in full, he or she will lose any right to the property and the lender will
either take possession of the property or arrange for it's sale. In Vermont, a
suit must be filed in the county where the property is located before either of
these actions can occur. The borrower will be served a summons to appear
before the court and informed of his rights, at which time the lender may move
for a summary judgment and avoid the trial altogether.
Regardless, the borrower has either a six (6) month (post-1968 mortgages) or
a twelve (12) month (pre-1968 mortgages)
redemption period.
Power of Sale Foreclosure
A "power of sale" clause is the clause in a deed of trust or mortgage, in which
the borrower pre-authorizes the sale of property to pay off the balance on a
loan in the event of the their default. In deeds of trust or mortgages where a
power of sale exists, the power given to the lender to sell the property may be
executed by the lender or their representative, typically referred to as the
trustee.
In Vermont, power of sale foreclosures are conducted either judicially or
non-judicially, depending on the type of property securing the deed of trust or
mortgage.
Judicial Foreclosure

2. In Vermont, lenders who wish to obtain a foreclosure using the power of sale
clause in the deed of trust must first file a complaint in a court having
jurisdiction in the county where the property is located to try and obtain a
decree of sale. This form of foreclosure must be used when the property
includes a dwelling of two units or less, with the owner using said property as
their principal residence. The sale of this type of property may not be held until
seven (7) months after the decree of sale has been issued.
Non-Judicial Foreclosure
In Vermont, when a power of sale is contained in a mortgage relating to any
property except for a dwelling house of two units or less, that is occupied by
the owner as a principal residence, or farmland, the lender may exercise the
power of sale without first commencing a foreclosure action or obtaining a
foreclosure decree.
Power of Sale Guidelines
At least thirty (30) days prior to the publication of a notice of sale, a notice of
intent to foreclose must be sent to the borrower by registered or certified mail
at his or her last known address. The notice of intent must include information
on the mortgage to be foreclosed, state the condition breached and the
lenders right to accelerate the mortgage, and include the total amount
necessary to cure the default. The borrower must also be informed that he or
she is entitled to receive a notice of sale at least sixty (60) days prior to the
date of sale.
The borrower may redeem the property at any time prior to the foreclosure
sale by paying the full amount due on the mortgage, plus costs.
The sale must be held on the property itself, unless otherwise ordered by the
court, and the property must be sold to the highest bidder. Anyone may bid at
the sale, including the lender. The borrower is entitled to receive any surplus
from the sale, but they may also be sued for deficiency if the sale price is not
enough to cover the amount of the mortgage in default.
If the property is sold without court action, as in non-judicial foreclosure by
power of sale, the notice of sale must include the following language:
"The mortgagor is hereby notified that at any time before the foreclosure sale,
the mortgagor has a right to petition the superior court for the county in which
the mortgaged premises are situated, with service upon the mortgagee, and
upon such bond as the court may require, to enjoin the scheduled foreclosure
sale. Failure to institute such petition and complete service upon the
foreclosing party, or their agent, conducting the sale prior to sale shall
thereafter bar any action or right of action of the mortgagor based on the
validity of the foreclosure, the right of the mortgage holder to conduct the
foreclosure sale, or compliance by the mortgage holder with the notice
requirements and other conditions of section 4532 of Title 12. An action to
recover damages resulting from the sale of the premises on the date of the
sale may be commenced at any time within one year following the date of the
sale, but not thereafter."
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