Tennessee is a non-judicial foreclosure state.
What that means is that, when conducting a foreclosure, there is no need to file a lawsuit or get a court involved. Instead, the foreclosure attorney can do it all via a variety of paperwork, without any court involvement.
As a lender or foreclosing creditor, that’s pretty awesome, since you may be able to avoid legal expense and, in some cases, third party scrutinty. (Well, I mean, I only enforce liens that are 100% valid, so I have no issues with this, but some might.)
As a foreclosure attorney, however, a non-judicial process can be a little scary, since the success of the process rises or falls based entirely on your compliance with the statutes, relevant provisions of the deed of trust, and your own paperwork.
In fact, on the first foreclosure I ever handled all on my own, I was terrified by the process. I was so uncertain about the process that I actually talked the client into the benefits of conducting a judicial foreclosure (both because the facts were a little weird, and also because it sure felt reassuring to have a Judge “bless” my process via a court order).
Since then, I’ve done hundreds more foreclosures, but I still remember that initial uncertainty about doing such a significant legal process, all without any court or third party involvement.
The point of today’s post is to: (1) remind you that Tennessee is a non-judicial foreclosure state; and (2) note that, despite that, a creditor always has the ability to file a Complaint for Judicial Foreclosure where the law or facts present a weird issue.
In the end, the real test of your compliance with all the requirements of the Deed of Trust and Tennessee statutes will the title company in the sale transaction when you go to sell the property to a later buyer. If you don’t get the process right, you’ll end up with a defective title and an unmarketable mess.
Good luck, new foreclosure attorneys.