Nebraska Foreclosure Procedure
Foreclosures in Nebraska take place judicially, through the filing of petitions for foreclosure in the Nebraska District Court for the county where the property is located.
A power of sale may be conferred upon the trustee which the trustee may exercise and under which the trust property may be sold in the manner provided in the Nebraska Trust Deeds Act after a breach of an obligation for which the trust property is conveyed as security, or at the option of the beneficiary a trust deed may be foreclosed in the manner provided by the Nebraska foreclosure law of mortgages on real property. The power of sale shall be expressly provided for in the trust deed.
The power of sale herein conferred upon the trustee shall not be exercised until the trustee shall first file for record in the office of the register of deeds of each county wherein the trust property or some part or parcel thereof is situated a notice of default identifying the trust deed; If the trust property is used in farming operations carried on by the trustor, not in any incorporated city or village, the notice of default also sets forth: and after the lapse of not less than one month, or two months if the notice of default is used in farming operations.
However, before the court will hear a petition for foreclosure, the lender must prove it has been unable to collect what was judged to be owed in the prior lawsuit. Whenever a petition for foreclosure is filed either alone or in conjunction with a petition for satisfaction of a mortgage, then the court can decree a sale of the mortgaged premises or such part as is needed to pay off the loan and the costs of suit.
The sheriff or officer holding the sale must give public notice of the time and place of the sale by posting the notice on the courthouse door and at five other public locations in the county where the property is located. Two of the five locations must be in the precinct where the property is located. In addition, the sheriff must advertise the property for sale once a week for four weeks in a newspaper either printed in the county or generally circulated in the county. After making the sale, the sheriff or officer will report it back to the court, which will then confirm the sale. Once the sale is confirmed, the borrower has no right to redeem the property.
A deed shall be executed by the sheriff and it will vest in the purchaser the same title the borrower had. The sales proceeds will be applied to discharge the lender's debt, and if there is a surplus, it goes to other persons who are entitled to it, or it must stay with the court for three months before it can be paid to the borrower.
Deficiency
A deficiency is only possible as a continuation of a foreclosure suit, but not while the foreclosure action is pending or remains incomplete.
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