How does foreclosure work in Vermont, and how long does it take?

Judicial or non-judicial?

Judicial for most homes. A lender may sell without a court case only if it follows the nonjudicial subchapter, and § 4961 excludes “farmland or a dwelling house owned by a natural person.” A “dwelling house” is a structure with one to four housing units, including condominium and cooperative units (§ 4931(2)). So a home owned by an individual is foreclosed by a lawsuit in the Civil Division of the Superior Court for the county where the land lies (§ 4932(a)). The nonjudicial route is open only for property other than farmland and such homes.

Two court routes.

• Strict foreclosure. The court may end the owner’s right to redeem without a sale, but only after finding there is “no substantial value in the property in excess of the mortgage debt,” plus other liens and unpaid property taxes (§ 4941(c)). The redemption period is six months from the decree unless a shorter time is ordered or agreed (§ 4941(d)).
• Judicial sale. Any party can ask, or the court can order, a public sale instead (§ 4941(b), § 4945(a)).

The steps, in order

1. Missed payments. The CFPB says that, “except in rare cases,” a servicer “can’t start the foreclosure process until at least 120 days after you become delinquent.”
2. Complaint filed. The lender sues in the county Superior Court and files a copy of the complaint with the town clerk where the property sits (§ 4932(b)). The defendant files a Verified Answer on the court’s foreclosure form (Vermont Judiciary).
3. Mediation, if requested. The defendant can submit a written form asking for foreclosure mediation. The Vermont Bar Association sends both sides a choice of three mediators, and the court picks one if they cannot agree. The mediator’s job is to make sure the lender has considered all options for modifying the loan so the borrower can stay in the home (Vermont Judiciary).
4. Decree and redemption. If the court grants a judicial sale, the owner of an owner-occupied home has a redemption period of six months from the decree unless the court orders less (§ 4946(b)).
5. Notice of sale. The notice is published once a week for three successive weeks, with the first publication at least 21 days before the sale. A copy is mailed after the redemption date and at least 30 days before the sale (§ 4952(b)-(c)).
6. The sale. It is held at the property unless the court directs another place, and the highest bidder wins (§ 4953(a)).
7. Confirmation. The plaintiff reports the sale to the court. The court’s confirmation order, once recorded in the town land records, transfers title to the buyer (§ 4954(a)-(b)).
8. Possession. The clerk issues a writ of possession on the plaintiff’s request (§ 4946(d)). A residential tenant gets at least 30 days after the writ is served, or longer if federal law requires (§ 4946(d)).

How long does it take?

Example: a lender serves its complaint on January 15, 2026. For an owner-occupied home, no sale may take place before August 15, 2026 unless the court shortens the period or both sides agree. That is a legal floor measured from service, not a forecast. A court calendar, a mediation, a bankruptcy filing or an appeal can add time.

Can you save the home?

Yes, at several points:

• Redeem before the sale. The owner may redeem “at any time prior to the public sale” by paying the full amount due under the judgment plus costs and expenses (§ 4949(a)). With the lender’s agreement, the owner may redeem for less, with court approval (§ 4949(b)).
• Reinstate or modify. With the lender’s agreement, the owner can reinstate or modify the loan after the redemption period but before the sale, and the lender then records a waiver of foreclosure (§ 4948).

What if the sale does not cover the debt?

The lender “may request a deficiency judgment in the foreclosure complaint,” and it must ask before the court issues the confirmation order. Failing to request one “shall be deemed a waiver of any deficiency judgment” (§ 4954(d)). If the sale brings in more than is owed, the surplus goes to junior lienholders in order of priority and then to the owner (§ 4954(c)).

Renters in a foreclosed home

A tenant is named as a defendant and warned that the right to stay may end when the foreclosure is completed. The owner must tell tenants of the case, and tenants may have to leave on 30 days’ notice, or longer if federal law requires (§ 4932(c)).

Where to get help

• Legal help. The Vermont Judiciary says to “talk to a lawyer right away” and to call Legal Services Vermont at 800-889-2047 to see if you qualify for free or lower-cost help.
• HUD-approved housing counselors. Call (800) 569-4287 to find one near you, or the Homeowners Hope Hotline at (888) 995-HOPE (HUD).
• Apply to your servicer early. The CFPB says to make sure the servicer gets your complete application “more than 37 days before your scheduled foreclosure sale.”

Related: property tax in Vermont, the Burlington market, and the escrow account guide.