District of Columbia Foreclosure Laws: Process, Timeline and Your Rights

Both. A deed of trust or mortgage with a power of sale can be foreclosed by a trustee's sale outside court, once the required notices are given and a mediation certificate is obtained. A lender can also ask the court to foreclose, and the court may order the property sold and the proceeds applied to the debt.

For a residential mortgage (1 to 4 single-family dwellings, including condos and co-ops), before a power-of-sale foreclosure the lender must (1) send the borrower and record owner a notice of default by certified mail (return receipt requested) and first-class mail, with a copy to the Mayor; (2) obtain a mediation certificate; and (3) send a separate notice of intention to foreclose by certified and first-class mail, with a copy delivered to the Mayor at least 30 days before the sale date. The notice of default must list the amount needed to cure and reinstate, and come with contact information for a HUD-approved housing counseling agency, loss-mitigation options and a mediation election form. The mediation certificate and the notice of intention to foreclose must be recorded in the land records.

A power-of-sale foreclosure cannot happen until a mediation certificate has been obtained, and the notice of intention to foreclose must reach the Mayor at least 30 days before the sale; the 30 days run from the date the Mayor receives the notice. The borrower has 30 days from the mailing of the mediation forms to return the mediation election form.

Yes. After a notice of intention to foreclose a residential mortgage, the borrower (or someone on the borrower's behalf) may cure the default up to 5 business days before bidding begins at the trustee's or judicial sale, but only once in any 2 consecutive calendar years. To cure, the borrower must pay the past-due amounts (not accelerated amounts) and reasonable late charges in cash, cashier's check or certified check, perform any other obligations, and pay the lender's foreclosure expenses such as advertising, trustee fees and reasonable attorney's fees. A cure puts the borrower back in the same position as if the default had not occurred.

Yes, in a court foreclosure. If the court orders the property sold and the net proceeds do not cover the mortgage debt, the court may enter a judgment against the borrower or another party liable for the debt for the remaining balance.

Yes. D.C. has a Foreclosure Mediation Program run under the Department of Insurance, Securities and Banking (DISB). After a notice of default on a residential mortgage, the lender must take part in mediation if the borrower elects it. The Mediation Administrator mails the borrower a notice that the borrower is eligible for mediation, and the borrower is asked to return the mediation election form within 30 days. Both sides must participate in good faith, including the lender evaluating the borrower for all available loss-mitigation options. A power-of-sale foreclosure may not proceed until a mediation certificate is obtained.

Yes, for condominiums. A condo unit owners' association may foreclose its assessment lien using a power of sale, unless the condominium documents expressly prohibit it. The sale cannot be held until at least 31 days after a "Notice of Foreclosure Sale of Condominium Unit for Assessments Due" is recorded and sent to the owner by tracked delivery and first-class mail; the notice must state the past-due amount and whether the sale is for the 6-month priority lien (not subject to the first mortgage) or for more (subject to the first mortgage). The owner may cure at any time before the sale by paying the past-due assessments plus late charges or interest and reasonable attorney's fees and costs.

Yes. A seller of real estate with 1 to 4 residential units (by sale, exchange, installment contract or lease-option) must give the buyer a signed real property disclosure statement on a form approved by the Mayor, before or when the buyer signs the purchase agreement. This applies only where the buyer states in writing an intent to live in the property, and some transfers (such as court-ordered transfers) are excluded.

After a tax sale, the owner or anyone with an interest may redeem at any time until a court judgment foreclosing the right of redemption becomes final, by paying the Mayor the amounts the law requires (including the amount paid by the buyer, unpaid taxes needed to bring the property current, and certain buyer expenses). The tax-sale buyer may file a suit to foreclose the right of redemption only after a 6-month waiting period following the sale.