How to avoid foreclosure in Rhode Island

How foreclosure works in Rhode Island, step by step

1. Missed payments and pre-foreclosure

   Federal rules generally bar the servicer from starting foreclosure until you are more than 120 days behind. Call your servicer and a housing counselor right away.

   12 C.F.R. § 1024.41(f)

2. Notice of mediation conference

   Before it can foreclose by power of sale, the lender must mail you a written notice that it may not foreclose without first taking part in a mediation conference. A lender that does not mail it within 120 days after default owes a penalty of $1,000 a month.

   R.I. Gen. Laws § 34-27-9(d)

3. Mediation conference

   A mediation coordinator from a HUD-approved counseling agency sets a conference, in person or by phone, within 60 days of the notice. It is free to you. Answer the coordinator and send the papers they ask for. If you do not respond after two attempts, the lender gets a certificate to go ahead.

   R.I. Gen. Laws § 34-27-9(f), (g)

4. Mailed notice of sale

   The lender must mail you notice of the time and place of the sale by certified mail at least 30 days before the first newspaper publication.

   R.I. Gen. Laws § 34-27-4(b)

5. Newspaper notice

   The sale is advertised once a week for three weeks in a row. The first ad must run at least 21 days before the sale, and the third ad must run no fewer than 7 and no more than 14 days before the sale date. The sale must be held no more than 14 days after the third ad.

   R.I. Gen. Laws § 34-27-4(a)

6. Auction and after

   The home is sold at public auction and the sale ends your rights in the property. The foreclosure deed cannot be recorded without the mediation certificate. If you stay in the home, the new owner must give you at least 30 days' written notice and go to court to evict you.

   R.I. Gen. Laws §§ 34-11-22, 34-27-9(m), 34-18-38.2(e)

Rhode Island foreclosure deadlines to know

These are the periods written into the law. Your own dates are on the notices you received. If a notice and this page disagree, trust the notice and ask a counselor or lawyer.

Your rights as a homeowner in Rhode Island

Other Rhode Island protections

• Mediation before foreclosure

  A lender cannot record a foreclosure deed unless it has a certificate showing it complied with the mediation law. Skipping mediation makes the foreclosure voidable.

  R.I. Gen. Laws § 34-27-9(m)

• Certified mail notice 30 days before advertising

  A foreclosure notice is not valid unless you were mailed notice of the sale by certified mail at least 30 days before the first publication.

  R.I. Gen. Laws § 34-27-4(b)

• Servicemember protections

  The sale notice must explain extra rights for servicemembers on or recently off active duty, who can get a stay of the foreclosure by giving written notice before the sale.

  R.I. Gen. Laws § 34-27-4(c), (d)

• Notice to tenants

  The lender must mail each tenant a notice of the scheduled sale with counseling contacts, and the notice must say it is not an eviction notice.

  R.I. Gen. Laws § 34-27-7

Rhode Island mortgage assistance programs

If the home is sold for more than you owe

Under the statutory power of sale, after the debt, interest, sale costs, and taxes or insurance the lender paid are covered, the lender must pay any surplus to the borrower along with an accounting of the sale. If you believe your home sold for more than you owed, ask the foreclosing lender or its attorney in writing for the accounting.

R.I. Gen. Laws § 34-11-22

Ways to avoid foreclosure

Most of your options come from federal rules and from whoever owns or insures your loan, so they work the same way in Rhode Island as anywhere else. What changes by state is how much time you have to use them.

• Repayment plan
• Forbearance
• Payment deferral or partial claim
• Loan modification
• Reinstatement
• Short sale
• Deed in lieu of foreclosure
• Chapter 13 bankruptcy