12 U.S.C. § 3755: Prerequisites to foreclosure

Summary

The Secretary may foreclose a mortgage if the borrower breaks a term of the mortgage. The Secretary cannot start a foreclosure under this chapter if another separate foreclosure action the Secretary already began is still active; that earlier action must be withdrawn, dismissed, or ended first. Once a foreclosure under this chapter has started, the Secretary may not start a different foreclosure on the same mortgage while the first one is still pending. The Secretary can still use other legal tools besides foreclosure. The Secretary may seek money judgments or other remedies, and may foreclose here even while asking for things like a receiver, mortgagee-in-possession status, or relief under an assignment of rents.

Title 12, §3755

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(a)In general

(1)Upon breach of covenant or condition

The Secretary is authorized to foreclose a mortgage under this chapter upon the breach of a covenant or condition in the mortgage agreement.

(2)No other pending proceedings

(A)Prior to commencement

No foreclosure may be commenced under this chapter unless any previously pending judicial or nonjudicial proceeding that has been separately instituted by the Secretary to foreclose the mortgage (other than under this chapter), has been withdrawn, dismissed, or otherwise terminated.

(B)After commencement

No separately instituted foreclosure proceeding on a mortgage which is the subject of a foreclosure proceeding under this chapter shall be instituted by the Secretary during the pendency of foreclosure pursuant to this chapter.

(b)Other rights unaffected

Nothing in this chapter shall preclude the Secretary from—

(1)enforcing any right, other than foreclosure, under applicable Federal or State law, including any right to obtain a monetary judgment; or

(2)foreclosing under this chapter if the Secretary has obtained or is seeking any other remedy available pursuant to Federal or State law, or under the mortgage agreement, including the appointment of a receiver, mortgagee-in-possession status, or relief under an assignment of rents.

Editorial Notes

Codification Section is based on section 806 of title VIII of S. 2281, One Hundred Third Congress, as reported July 13, 1994, which was enacted into law by Pub. L. 103–327.

§3755 Prerequisites to Foreclosure

Summary

Title 12, §3755

Notes & Related Subsidiaries

Editorial Notes

Citations & Metadata