South Carolina Foreclosure Laws

Answers

How are mortgage liens treated in South Carolina?

South Carolina is known as a lien theory state where the property acts as security for the underlying loan. The document that places the lien on the property is called a mortgage.

How are South Carolina deeds foreclosed?

In South Carolina, the lenders go to court in what is known as a judicial foreclosure proceeding where the court must issue a final judgment of foreclosure. The property is then sold as part of a publicly noticed sale. The court with jurisdiction over a foreclosure is known as the Circuit Court. A complaint is filed in court along with what is known a lis pendens. A lis pendens is a recorded document that provides public notice that the property is being foreclosed upon.

What are the legal instruments that establish a South Carolina mortgage?

The documents are known as the mortgage or in a commercial transaction, a security agreement. Sometimes the mortgage document is combined with the security agreement.  A mortgage is filed to evidence the underlying debt and terms of repayment, which is set forth in the note.

How long does it take to foreclose a property in South Carolina?

Depending on the court schedule, it usually takes approximately 150-180 days to effectuate an uncontested foreclosure. This process may be delayed if the borrower contests the action, seeks delays and adjournments of hearings, or files for bankruptcy. Borrowers must receive a notice of sale which must be published for at least three (3) consecutive weeks in a newspaper of general circulation. This notice includes posting at the courthouse and other locations at least three (3) weeks before the sale. South Carolina has a process called an application for an order of appraisal. A borrower usually requests this process where an independent appraiser determines the high value of the property which may be substituted for the sale amount if the lender is seeking a deficiency. Unless the property is a residence or the subject of a consumer credit transaction these appraisal rights may be waived.

Is there a right of redemption in South Carolina?

No. South Carolina does not have a statutory right of redemption, which allows a party whose property has been foreclosed to reclaim that property by making payment in full of the sum of the unpaid loan plus costs. There is a time limit to undertake such redemption.

Are deficiency judgments permitted in South Carolina?

Yes. A deficiency judgment may be obtained when a property in foreclosure is sold at a public sale for less than the loan amount which the underlying mortgage secures.  This means that the borrower still owes the lender for the difference between what the property sold for at auction and the amount of the original loan. Deficiency judgments are subject to appraisal rights as noted above.

What statutes govern South Carolina foreclosures?

The laws that govern South Carolina foreclosures are found in South Carolina Code of Laws (2004) Title 29 (Mortgages and Other Liens), Chapter 3, Article 7 (Foreclosures) (Section 29-3-610 et. seq.).