846.165 Annotation
"Fair value" under sub. (2) is determined by the property's sale value. The court may consider costs of selling, holding, or carrying the property only to the extent that they affect the sale value. First Financial Savings Assoc. v. Spranger,
156 Wis. 2d 440,
456 N.W.2d 897 (Ct. App. 1990).
846.165 Annotation
The purchaser at a foreclosure sale has a right to notice of when the sale has been confirmed, when the mortgagor's redemption period ends, and when the 10-day payment period under s. 846.17 expires. GMAC Mortgage Corp. v. Gisvold,
215 Wis. 2d 459,
572 N.W.2d 466 (1998),
96-1663.
846.165 Annotation
Because s. 703.10 (6) prohibits condominium bylaws from affecting the transfer of title to a condominium unit, a bylaw prohibiting the sale of any unit to an owner who would not reside in the unit could not be applied to prevent the confirmation of a foreclosure sale to the high bidder who admitted he would not occupy the premises. Also, the potential failure to occupy the unit had no recognized legal relationship to the confirmation of the sheriff's sale and the transfer of title. Bankers Trust Company of California, N.A. v. Bregant, 2003 WI App 86,
261 Wis. 2d 855,
661 N.W.2d 498,
02-2085.
846.165 Annotation
Under sub. (2), when a creditor seeks a deficiency judgment, there is no presumption that the property sold for fair value. From that, it follows that when the mortgagee does not seek a deficiency judgment, there is a presumption. The statute does not eliminate the requirement that the court find fair value. A tax assessment, like an appraisal, can be viewed as a measure of fair value. Each case must be considered on its merits. Bank of New York v. Mills, 2004 WI App 60,
270 Wis. 2d 790,
678 N.W.2d 332,
03-1339.
846.165 Annotation
This section does not preclude a purchaser from obtaining a confirmation hearing when the mortgagee's application for confirmation has been withdrawn. This affords the purchaser an opportunity to have the court decide whether it is entitled to transfer of the property under applicable law, and does not undermine the rights of the lienholders and mortgagor to object to certification as provided by law. JP Morgan Chase Bank, NA v. Green, 2008 WI App 78,
311 Wis. 2d 715,
753 N.W.2d 536,
07-1753.
846.17
846.17
Deed, execution and effect of. Upon any such sale being made the sheriff or referee making the same, on compliance with its terms, shall make and execute to the purchaser, the purchaser's assigns or personal representatives, a deed of the premises sold, setting forth each parcel of land sold to the purchaser and the sum paid therefor, which deed, upon confirmation of such sale, shall vest in the purchaser, the purchaser's assigns or personal representatives, all the right, title and interest of the mortgagor, the mortgagor's heirs, personal representatives and assigns in and to the premises sold and shall be a bar to all claim, right of equity of redemption therein, of and against the parties to such action, their heirs and personal representatives, and also against all persons claiming under them subsequent to the filing of the notice of the pendency of the action in which such judgment was rendered; and the purchaser, the purchaser's heirs or assigns shall be let into the possession of the premises so sold on production of such deed or a duly certified copy thereof, and the court may, if necessary, issue a writ of assistance to deliver such possession. Such deed or deeds so made and executed by the sheriff as above set forth shall be forthwith delivered by the sheriff to the clerk of the court to be held by the clerk until the confirmation of the sale, and upon the confirmation thereof the clerk of the court shall thereupon pay to the parties entitled thereto, or to their attorneys, the proceeds of the sale, and shall deliver to the purchaser, the purchaser's assigns or personal representatives, at the sale such deed upon compliance by such purchaser with the terms of such sale, and the payment of any balance of the sale price to be paid. In the event of the failure of such purchaser to pay any part of the purchase price remaining to be paid within 10 days after the confirmation of such sale, the amount so deposited shall be forfeited and paid to the parties who would be entitled to the proceeds of such sale as ordered by the court, and a resale shall be had of said premises, and in such event such deed so executed to the defaulting purchaser shall be destroyed by said clerk, and shall be of no effect. In the event that such sale is not confirmed by the court, the clerk shall forthwith refund to the purchaser at such sale the amount so paid or deposited by the purchaser, and shall likewise destroy such sheriff's deed so executed, and the same shall be of no effect, and a resale of the premises shall be had upon due notice thereof.
846.17 History
History: 1973 c. 189 s.
7; Stats. 1973 s. 816.17; Sup. Ct. Order,
67 Wis. 2d 585, 768 (1975); Stats. 1975 s. 846.17;
1993 a. 486.
846.17 Annotation
That the balance of the purchase price be paid within 10 days of confirmation of sale or be forfeited is mandatory and is not waivable by the court as a matter of equity. The purchaser has a right to notice of when the sale has been confirmed, when the mortgagor's redemption period ends, and when the 10-day payment period expires. GMAC Mortgage Corp. v. Gisvold,
215 Wis. 2d 459,
572 N.W.2d 466 (1998),
96-1663.
846.18
846.18
Tardy confirmation of sale. In all cases where a mortgage foreclosure sale has been made but not confirmed and the purchaser or the purchaser's successor or assign has taken possession of the land by virtue of said sale, and occupied it for 6 years from and after said sale, the purchaser may apply for and the court may enter an order confirming said foreclosure sale with the same force and effect as if said confirmation was made as otherwise provided by law.
846.18 History
History: 1973 c. 189 s.
7; Stats. 1973 s. 816.18; Sup. Ct. Order,
67 Wis. 2d 585, 768 (1975); Stats. 1975 s. 846.18;
1993 a. 486.
846.18 Annotation
This section does not establish that a purchaser may apply for confirmation only after 6 years of occupancy. It provides a remedy for purchasers or their successors or assigns when, for whatever reason, the sale is not confirmed according to the procedures in s. 846.165, but their occupancy for a sufficient period entitles them to confirmation by this alternative route. JP Morgan Chase Bank, NA v. Green, 2008 WI App 78,
311 Wis. 2d 715,
753 N.W.2d 536,
07-1753.
846.25
846.25
Discharge after foreclosure. After a mortgage has been foreclosed by action and the judgment and costs have been paid and satisfaction of the mortgage entered upon the court record, the clerk of circuit court, on request, shall sign a certificate attesting to those facts, which certificate is entitled to record.
846.25 History
History: Sup. Ct. Order,
67 Wis. 2d 585, 768 (1975);
1995 a. 224.
846.25 Cross-reference
Cross-reference: For redemption from mortgage foreclosure, prior to sale, see s.
846.13.
846.30
846.30
Redemption period for land contracts. If a court finds that the purchaser under a land contract is obligated to make certain payments under that land contract, that the purchaser has failed to make the required payments and that the vendor is entitled to a judgment of strict foreclosure, the court shall set a redemption period of at least 7 working days from the date of the judgment hearing or, if there is no hearing, from the date of the entry of the judgment order. No judgment of strict foreclosure is final until the court enters an order after the expiration of the redemption period confirming that no redemption has occurred and making the judgment of strict foreclosure absolute.
846.30 History
History: 1995 a. 250.
846.30 Annotation
Equitable title remains with a land contract vendee until a circuit court enters an order under this section confirming the land contract vendee's default following the expiration of the redemption period for strict foreclosure. Steiner v. Wisconsin American Mutual Insurance Company, 2005 WI 72,
281 Wis. 2d 395,
697 N.W.2d 452,
03-1959.
846.30 Annotation
The minimum redemption period was enacted to prevent a court from not affording any right to redemption when the vendee, or someone else so entitled, wanted one. Neither this purpose nor the language of the statute supports requiring a period of redemption even if all parties with a right to redemption waive that right. The use of the word shall does not mean that the vendee or whoever has the right to redemption may not waive it. Republic Bank of Chicago v. Lichosyt, 2007 WI App 150,
303 Wis. 2d 474,
736 N.W.2d 153,
06-1578.
846.30 Annotation
Case law does not accord the right to redemption in strict foreclosure actions to judgment lienholders. Republic Bank of Chicago v. Lichosyt, 2007 WI App 150,
303 Wis. 2d 474,
736 N.W.2d 153,
06-1578.
846.35
846.35
Protections for tenants in foreclosure actions. 846.35(1)(a)(a) If residential rental property is the subject of a foreclosure action, the plaintiff shall provide the following notices at the following times to the tenants who are in possession of each rental unit when a notice is given:
846.35(1)(a)1.
1. No later than 5 days after the foreclosure action is filed, notice that the plaintiff has commenced a foreclosure action with respect to the rental property.
846.35(1)(a)2.
2. No later than 5 days after the judgment of foreclosure is entered, notice that the plaintiff has been granted a judgment of foreclosure with respect to the rental property and notice of the date on which the redemption period ends.
846.35(1)(a)3.
3. When the confirmation of sale hearing has been scheduled, notice of the date and time of the hearing.
846.35(1)(b)
(b) The notices under
par. (a) may be given in any of the following ways:
846.35(1)(b)2.
2. By certified mail with return receipt requested. Notice given under this subdivision is considered completed when it is mailed, unless the envelope enclosing the notice is returned unopened to the plaintiff. All notices mailed under this subdivision shall be mailed in envelopes upon which the plaintiff's, or the plaintiff's attorney's, return address appears, with a request to return to that address.
846.35(2)
(2) Extended possession of premises; withholding last month's rent. 846.35(2)(a)(a) Notwithstanding
ch. 704, all of the following apply to a tenant whose tenancy is terminated as a result of a foreclosure judgment and sale with respect to the rental property:
846.35(2)(a)1.
1. Subject to
subd. 3., the tenant may retain possession of the tenant's rental unit for up to 2 months after the end of the month in which the sale of the property is confirmed.
846.35(2)(a)2.
2. The tenant may withhold rent in an amount equal to the security deposit during the last period the tenant actually retains possession of the rental unit, regardless of whether the tenant retains possession after the sale of the property is confirmed, as authorized under
subd. 1.
846.35(2)(a)3.
3. The tenant's right to retain possession of the rental unit expires at the end of the month for which the tenant withholds rent, as authorized under
subd. 2.
846.35(2)(b)
(b) Subject to
par. (a) 2., a tenant who retains possession of the rental unit after the sale of the property is confirmed shall pay rent for the period during which the tenant retains possession at the same rate that applied immediately before the confirmation of the sale of the property.
846.35(3)
(3) Execution of writ of assistance or restitution. No writ of assistance or writ of restitution for the removal of a tenant whose tenancy is terminated as a result of a foreclosure judgment and sale may be executed before the end of the 2nd month beginning after the month in which the sale of the property is confirmed, unless the tenant has waived in writing the right under
sub. (2) (a) 1. to retain possession of the rental unit.
846.35(5)
(5) Tenant not named in complaint. In an action for foreclosure of residential real property, the complaint may not name a tenant as a defendant unless the tenant has a lien or ownership interest in the real property.
846.35(6)
(6) Penalties. If a plaintiff fails to provide a notice under
sub. (1) (a) in accordance with
sub. (1) (a) and
(b), or fails to comply with
sub. (5), the court shall award the tenant to whom the notice should have been given or who should not have been named as a defendant $250 in damages, plus reasonable attorney fees. A tenant may not recover under this paragraph for more than one notice violation.
846.35 History
History: 2009 a. 2,
28,
276.
846.35 Annotation
The Problem of Lender Compliance with Tenant-Notice Requirements. Farnam & Laubmeir. Wis. Law. Aug. 2009.
846.40
846.40
Regulation of foreclosure reconveyances. 846.40(1)(a)
(a) "Closing" means an in-person meeting to complete final documents incident to the sale of real property or the creation of a mortgage on real property that is conducted by a closing agent who is not employed by, an affiliate of, or employed by an affiliate of, any foreclosure purchaser involved in the closing, and who does not have a business or personal relationship with any foreclosure purchaser involved in the closing other than the provision of real estate settlement services.
846.40(1)(b)
(b) "Foreclosed homeowner" means an owner of a residence in foreclosure.
846.40(1)(c)
(c) "Foreclosure purchaser" means a person that has acted as the acquirer in a foreclosure reconveyance. "Foreclosure purchaser" also includes a person that has acted in joint venture or joint enterprise with one or more acquirers in a foreclosure reconveyance. "Foreclosure purchaser" does not include any of the following:
846.40(1)(c)1.
1. A natural person who shows that he or she is not in the business of foreclosure purchasing and who has a prior personal relationship with the foreclosed homeowner.
846.40(1)(c)2.
2. A federal or state chartered bank, savings bank, savings and loan association, or credit union.
846.40(1)(d)
(d) "Foreclosure reconveyance" means a transaction involving all of the following:
846.40(1)(d)1.
1. The transfer of title to real property by a foreclosed homeowner during a foreclosure proceeding, either by a transfer of interest from the foreclosed homeowner or by the creation of a mortgage or other lien or encumbrance during the foreclosure process.
846.40(1)(d)2.
2. The subsequent conveyance, or promise of a subsequent conveyance, of an interest back to the foreclosed homeowner by the acquirer or a person acting in participation with the acquirer that allows the foreclosed homeowner to possess either the residence in foreclosure or other real property, which interest includes an interest in a land contract, purchase agreement, option to purchase, or lease.
846.40(1)(e)
(e) "Primary housing expenses" means the sum of payments for regular principal, interest, rent, utilities, fire and casualty insurance, real estate taxes, and association dues.
846.40(1)(f)
(f) "Resale" means a bona fide market sale of the property subject to the foreclosure reconveyance by the foreclosure purchaser to an unaffiliated 3rd party.
846.40(1)(g)
(g) "Resale price" means the gross sale price of the property on resale.
846.40(1)(h)
(h) "Residence in foreclosure" means residential real property located in this state that consists of one to 4 family dwelling units and with respect to which real property there is a delinquency or default on any loan payment or debt secured by or attached to the residential real property, including land contract payments. The owner of the residential real property may, but is not required to, occupy the residential real property as the owner's principal place of residence.
846.40(2)
(2) Contract requirement; form and language. A foreclosure purchaser that enters into any foreclosure reconveyance shall do so by a written contract. Every contract must be written in letters of not less than 12-point boldface type, both in English and in the same language principally used by the foreclosure purchaser and foreclosed homeowner to negotiate the sale of the residence in foreclosure if other than English, and must be fully completed, signed, and dated by the foreclosed homeowner and foreclosure purchaser before the execution of any instrument of conveyance of the residence in foreclosure.
846.40(3)(a)(a) Every contract required by
sub. (2) must contain the entire agreement of the parties and must include all of the following terms:
846.40(3)(a)1.
1. The name, business address, and telephone number of the foreclosure purchaser.
846.40(3)(a)3.
3. The total consideration to be given by the foreclosure purchaser in connection with or incident to the sale.
846.40(3)(a)4.
4. A complete description of the terms of payment or other consideration, including any services of any nature that the foreclosure purchaser represents he or she will perform for the foreclosed homeowner before or after the sale.
846.40(3)(a)5.
5. The time at which possession is to be transferred to the foreclosure purchaser.
846.40(3)(a)6.
6. A complete description of the terms of any related agreement designed to allow the foreclosed homeowner to remain in possession of the home, such as a rental agreement, repurchase agreement, land contract, or lease with option to purchase.
846.40(3)(a)9.
9. Immediately above the statement required by
sub. (5) (a), in not less than 14-point boldface type if the contract is printed or in capital letters if the contract is typed, and completed with the name of the foreclosure purchaser, the following notice:
NOTICE REQUIRED BY WISCONSIN LAW
Until your right to cancel this contract has ended, .... (Name of foreclosure purchaser) or anyone working for .... (Name of foreclosure purchaser) CANNOT ask you to sign or have you sign any deed or any other document.
846.40(3)(b)
(b) The contract required by this subsection survives delivery of any instrument of conveyance of the residence in foreclosure and has no effect on persons other than the parties to the contract.
846.40(4)(a)(a) In addition to any other right of rescission, the foreclosed homeowner has the right to cancel any contract with a foreclosure purchaser until midnight of the 5th business day following the day on which the foreclosed homeowner signs a contract that complies with
subs. (2) to
(6) or until 8:00 a.m. on the last day of the period during which the foreclosed homeowner has a right of redemption, whichever occurs first.
846.40(4)(b)
(b) Cancellation occurs when the foreclosed homeowner delivers to the foreclosure purchaser, personally or by certified mail, a signed and dated written notice of cancellation. The contract and notice of cancellation form under
sub. (5) (b) must contain a street or physical address to which notice of cancellation may be mailed by certified mail or personally delivered. A post office box may be designated for delivery by certified mail only if it is accompanied by a street or physical address at which the notice may be personally delivered. If the notice of cancellation is personally delivered, the foreclosure purchaser must provide a receipt to the foreclosed homeowner. If cancellation is mailed by certified mail, delivery is effective when the notice of cancellation is deposited in the U.S. mail. If cancellation is personally delivered, delivery is effective when the notice of cancellation is handed to the foreclosure purchaser.
846.40(4)(c)
(c) A notice of cancellation given by the foreclosed homeowner need not take the particular form provided under
sub. (5) (b).
846.40(4)(d)
(d) Within 10 days following receipt of a notice of cancellation given in accordance with this subsection, the foreclosure purchaser shall return without condition any original contract and any other documents signed by the foreclosed homeowner.
846.40(5)(a)1.1. The contract must contain conspicuously and in immediate proximity to the space reserved for the foreclosed homeowner's signature, in not less than 14-point boldface type if the contract is printed or in capital letters if the contract is typed, the following statement: "You may cancel this contract for the sale of your house without any penalty or obligation at any time before .... (date and time of day). See the attached notice of cancellation form for an explanation of this right."
846.40(5)(a)2.
2. The foreclosure purchaser shall accurately enter the date and time of day on which the cancellation right ends.
846.40(5)(b)
(b) The contract must be accompanied by a completed form in duplicate, captioned "Notice of cancellation" in 12-point boldface type if the contract is printed or in capital letters if the contract is typed, followed by a space in which the foreclosure purchaser shall enter the date on which the foreclosed homeowner executes the contract. This form must be attached to the contract, must be easily detachable, and must contain, in not less than 10-point type if the contract is printed or in capital letters if the contract is typed, the following statement:
NOTICE OF CANCELLATION
(Enter date contract signed)
846.40(5)(b)1.
1. You may cancel this contract for the sale of your house, without any penalty or obligation, at any time before .... (date and time of day).
846.40(5)(b)2.
2. To cancel this transaction, you may mail by certified mail or personally deliver a signed and dated copy of this notice of cancellation to .... (name of purchaser) at .... (street or physical address of purchaser's place of business) NOT LATER THAN .... (date and time of day). If you personally deliver this notice of cancellation, .... (name of purchaser) must give you a receipt.
(Date) ....
(Seller's signature) ....
846.40(5)(c)
(c) The foreclosure purchaser shall provide the foreclosed homeowner with a copy of the contract and the attached notice of cancellation form at the time the contract is executed by all parties.
846.40(5)(d)
(d) The 5-day period under
sub. (4) (a) during which the foreclosed homeowner may cancel the contract does not begin to run until all parties to the contract have executed the contract and the foreclosure purchaser has complied with this subsection.
846.40(6)
(6) Waiver. Any waiver of the provisions of this section is void and unenforceable as contrary to public policy, except that a foreclosed homeowner may waive the 5-day right to cancel under
sub. (4) (a) if the property is subject to a foreclosure sale within the 5 business days and the foreclosed homeowner agrees to waive his or her right to cancel in a handwritten statement signed by all parties holding title to the foreclosed property.
846.40(7)
(7) Liability. Any provision in a contract entered into on or after March 6, 2009, that attempts or purports to require arbitration of any dispute arising under this section is void at the option of the foreclosed homeowner.
