Sell Your Tennessee House Before the Trustee's Sale

Most Tennessee home loans are secured by a deed of trust with a power-of-sale clause, which lets the lender's trustee (or a substitute trustee appointed for the foreclosure) sell the property at a public auction without first suing the borrower in court. Because of that, Tennessee is overwhelmingly a non-judicial foreclosure state. Judicial foreclosure is legally possible here but is rarely the route lenders actually use.

Under federal servicing rules, most servicers are required to wait until a borrower is around 120 days delinquent before formally starting foreclosure, and many wait longer while loss-mitigation options are reviewed. Once a foreclosure is underway, Tennessee law requires the trustee to publish notice of the sale in a newspaper of general circulation in the county once a week for three consecutive weeks, with the first publication typically at least 20 days before the sale date. The trustee must also send a copy of that notice to the homeowner by mail. Put together, the stretch from a formal notice of sale to the actual auction is often around three to four weeks, but the total time from a borrower's first missed payment to a scheduled sale is commonly several months once you count the delinquency period and any loss-mitigation review.

Tennessee foreclosure sales are typically held by the trustee at the courthouse door of the county where the property sits, or at another location named in the notice, and the property is sold to the highest bidder for cash, frequently the lender itself via a credit bid.

Tennessee law technically provides a statutory right of redemption after certain foreclosure sales, but the large majority of Tennessee deeds of trust include a clause in which the borrower waives that right in advance, so in practice most non-judicial trustee's sales in the state are treated as final once conducted. Tennessee also generally allows a lender to pursue a deficiency judgment for the gap between what was owed and what the property brought at auction, though the calculation is expected to reflect the property's fair market value rather than only the sale price. Up until the moment the trustee's sale is actually conducted, most Tennessee homeowners can typically still sell the home, refinance, bring the loan current, or work out an alternative directly with their servicer.

Questions Tennessee homeowners ask us

Is Tennessee a judicial or non-judicial foreclosure state?

Tennessee is overwhelmingly a non-judicial foreclosure state. Nearly every Tennessee mortgage is structured as a deed of trust with a power-of-sale clause, which lets the trustee foreclose by publishing and mailing the required notices and holding a public auction, without filing a lawsuit or getting a judge's sign-off on the foreclosure itself. Judicial foreclosure is legally available in Tennessee but rarely the method lenders actually use.

How much notice do I get before a Tennessee trustee's sale?

Tennessee law requires the trustee to publish notice of the sale in a local newspaper once a week for three consecutive weeks, with the first publication typically at least 20 days before the sale date, and to mail a copy of that notice to the homeowner. That published notice period is usually only a few weeks, though the overall process (starting from when a borrower first falls behind) is often several months once you add in the servicer's required waiting period and any loss-mitigation review.

Can I get my house back after a foreclosure auction in Tennessee?

Usually not. Tennessee law technically allows a statutory right of redemption after some foreclosure sales, but the vast majority of Tennessee deeds of trust contain language where the borrower waives that right in advance, so most trustee's sales in the state end up being treated as final once the sale is conducted. That's a big part of why it matters to act before your sale date rather than plan on undoing the sale afterward. Be sure to verify your specific document's terms with a Tennessee attorney or housing counselor.