Foreclosure & Eviction in Wisconsin

Although at least one national foreclosure website lists Wisconsin as one of those states where a foreclosure can be either judicial--that is, authorized through court action--or non-judicial, the University of Wisconsin, at Madison, Law School clarifies that all foreclosures in the state are handled by the court, according to state law. Eviction notice requirements for tenants in Wisconsin arise from both state and federal law.

Lawsuit and Judgment

A foreclosure in Wisconsin begins with a lawsuit. The owner is served with both the complaint and a summons. About the same time, the lender must provide notice to any tenants in the property to inform them a foreclosure is being initiated. If the owner does not respond to the summons, a default judgment will be issued, approving the foreclosure. If a response is filed, a court hearing will follow. Eleven Wisconsin counties have incorporated a mediation process into foreclosure actions, available if either the lender or borrower requests it and the court approves. Mediation outcomes, if successful, might include a temporary abeyance of mortgage payments or loan modification. If, at the end, the court decides in favor of the lender, a judgment is entered against the borrower. The court notifies the owner; the lender notifies the tenants.

Redemption Period

There is a redemption period of between two and 12 months in Wisconsin, during which the owner retains title, may continue to live in the house if it is his residence, and may redeem the property by paying the lender the loan balance and all accrued fees.

Eviction

At the end of the redemption period the property is sold by the sheriff. About three weeks later, a confirmation of sale is scheduled. At any point after this the lender, if they have taken possession because no one offered more than the mortgage debt at the sheriff's sale, or the new owner may initiate an eviction. The new owner is required to give the previous owner, if he lives in the property, a 3-day notice to leave. The new owner must give a 90-day notice to any tenants in the building, under the federal Protecting Tenants at Foreclosure Act of 2009. New owners must also honor any fixed-term leases in existence before the foreclosure.

Cash for Keys

Cash for Keys is a lender program that gives occupants--whether tenants or owners--a cash incentive for voluntarily moving out of a foreclosed house. This saves the lender the cost of a court-ordered eviction. If you have or think you are about to receive an eviction notice, you may consider contacting the lender to negotiate cash for keys.

References

• Univ. of Wisconsin Law School: Responding to a Foreclosure Lawsuit in Dane County
• foreclosure.org: Wisconsin Foreclosure Law Summary
• National Housing Law Project: State and Local Tenant Protections
• University of Wisconsin Law School: Wisconsin Foreclosure Timeline
• Nolo: Renters in Foreclosure: What Are Their Rights?