BluegrassForeclosure.com

We’ve discussed what the Master Commissioner is here and what a note and mortgage are here.  Let’s go over how the Master Commissioner actually gets the property and/or is ordered to sell the property.

As noted previously, Kentucky is a judicial state, meaning a foreclosure action must be filed in court and an order entered to sell it.  How does this happen?

A complaint must be filed in the circuit court of the county where the property is located.  Not to get all legalese or anything, but the circuit court has jurisdiction and the county where the property is located is the correct venue.  So if the debtors or soon to be former owners have moved out, you don’t have to worry about filing wherever they are located.

The Plaintiff is the entity that files suit.  The Plaintiff has to have a legal right to begin a foreclosure.  In most cases, it is a bank that holds a note and mortgage against the property.  It can also be a trust (more on securitization later), a servicer for the trust, or some other lien holder, whether it be a tax lien or a judgment lien.

The Defendant(s) can be numerous, depending on what is going on with the property.  Most often the first defendants are the actual debtors.  If the debtors are not the actual owners of the real estate (such as commercial property), then you have to add the owners of the real estate, the tenants and anyone else that has an interest in the property.  You also have to add any tax lien holders, whether it is a federal, state, or local municipality, or a third party entity that has bought a tax lien.

Then you need to add any entity that holds a senior or junior mortgage, any other type of junior lien, or even unknown spouses, or unknown heirs, if one of the debtors is deceased.

As you can see, it can get pretty convoluted assuming what type of liens are recorded against a piece of property.

Next: how a foreclosure lawsuit gets to judgment.