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6 Ways to Defend Against Foreclosure on a Deed of Trust

Foreclosure is the process by which a lender retakes real estate when a borrower defaults on a home loan. In states that allow the use of a deed of trust as opposed to a mortgage agreement, most homes are foreclosed through a process called non-judicial foreclosure. Non-judicial foreclosure, as the name implies, occurs outside of the court system, and is usually much faster and cheaper than judicial foreclosure.


In general, defending against non-judicial foreclosure in court is difficult because you usually must show the court that you’ll be able to afford to pay off the loan if it is reinstated. This article assumes that you have already sought forbearance on the loan, which allows you to reduce your payments for a period of time until you can start paying in full.

If You Haven't Sought Forbearance...

Call your lender to talk about your forbearance options. You can also ask your lender about reducing your payments through loan modification, a process protected by the federal government under the Home Affordable Modification Program (HAMP).

Below are six helpful ways to defend non-judicial foreclosure.

Unconscionable Terms in the Agreement

You can try to convince a judge that the terms in the agreement and circumstances surrounding the formation of the agreement are unconscionable. This requires more than just a one-sided deal and slight unfairness. The agreement must be grossly unfair to the point that the borrower has clearly been taken advantage of to the point that it “shocks the conscience” of the judge. An example would be if the lender changed important terms in the agreement without the borrower knowing before signing it.

Improper Foreclosure under State Law

State law specifies the procedure that must be followed to properly foreclose on a property. For instance, some states require that the borrower receive a notice of default prior to foreclosure to put the borrower on notice and, in some cases, give the borrower a chance to fix the default. Some states that allow deeds of trust require that the assignment to the trustee be recorded in the county recorder’s office in order to be enforceable. Therefore, if the deed of trust hasn’t been properly recorded, the court may allow foreclosure to be avoided.

Mortgage Reinstatement or Redemption

Another option would be to try for mortgage reinstatement or redemption. These options are statutory rights in many states.

  • Mortgage reinstatement: The borrower pays off all amounts that are past due plus any fees if the lender agrees to stop foreclosure.
  • Mortgage redemption: The borrower pays off the entire outstanding loan.

Often borrowers are required to exercise these rights before the foreclosure sale date, so if that date has passed, you may no longer have these options.

Foreclosure Assistance

Check your state’s laws either on the relevant state or federal website as given here for any foreclosure assistance programs it may have. These programs give eligible borrowers money to help them cure their default and get back up on their feet.

You're on Active Duty

If you are a service member on active duty, the Servicemembers Civil Relief Act (SCRA) offers you foreclosure protection. The SCRA will at least allow you to postpone foreclosure until after you are done with active duty, allowing you time to hopefully catch up on your payments.

Filing Bankruptcy

Filing bankruptcy is often an excellent option and shouldn’t necessarily be viewed as a last resort. When you file bankruptcy an automatic stay goes into effect that halts any foreclosure action as well as other debt collection activities. You can consult a local bankruptcy attorney for help to figure out whether bankruptcy is right for you.

How LegalNature Can Help You with Your Legal Form Needs

LegalNature can help you with all of your personal legal form needs such as deeds of trust and mortgage agreements. Let us help you get started today. Click here to create your deed of trust now.

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