What kind of preliminary and final decree is passed in a foreclosure suit?

Question: What kind of preliminary and final decree is passed in a foreclosure suit?

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Answer

A decree of foreclosure and sale, sometimes simply called a decree of foreclosure, is a declaration made by a court indicating the amount of outstanding debt that a borrower has defaulted on and that their property will be sold to cover the outstanding debt. A decree of foreclosure is a court order stating that a property will enter the foreclosure process due to a mortgage default, where borrowers fail to make their payments for an extended period of time.

Order 34 Rule 2 states the preliminary decree in a foreclosure suit.

Once the suit has been filed, and the plaintiff succeeds in proving the court directs to take an account of the sum that is due to pay at the date of the decree. The sum shall include-

1. The mortgage money;
2. The cost of the suit, if any;
3. Any other cost that may be incurred to him concerning the immovable property.

Once the amount has been declared to the court, the court passes a decree for the defendant to pay the amount so declared on or before the date as the court may have fixed within six months from the date on which the court confirms and countersigns the account taken. Further, if there is a default in payment then the plaintiff shall be entitled to apply for a final decree for the sale of the property.

Rule 4 sub-rule 4 states that the person receiving the benefits of the title of the decree for sale shall also be a party to the suit. It provides for the adjudication of the respective rights and liabilities of the parties to the suit and form outlined in Form No. 9, Form No. 10, or Form No. 11, as the case may be, of Appendix D with such variations as the circumstances of the case may require

Order 34 Rule 3 states the final decree in a foreclosure suit. It provides-

When the defendant pays the mortgage amount of the suit before the confirmation of sale made in the final decree, then the court shall file a final decree ordering the plaintiff to return the documents related to the mortgaged property; transferring the property back to the defendant; and put the defendants back in the possession of the property.

When the payment has not been made after the due date by the preliminary decree, then the court shall pass a final decree ordering to sell the immovable property or part of the property of the defendant to recover the mortgage money.

Where payment has not been made as ordered by the Court, the Court shall, on a necessary application made by the plaintiff, pass a final decree declaring that the defendant and all persons claiming through or under him or debarred from all right to redeem the mortgaged property and also, if, ordering the defendant to put the plaintiff in possession of the property.

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