JUDICIAL

FORECLOSU
RE
Ajudicial
foreclosureoccurs when
a court allows alenderto
seize and sell a
borrower'scollateralwhen
the borrower has failed to
repay thelender.
Thetermis most often
associated withreal estate.
JUDICIAL FORECLOSURE UNDER RULE
68,

RULES of
COURT
 II. The court will conduct
I. The mortgagee
a trial.
should file a
petition for judicial
foreclosure in the
court which has
jurisdiction over the
area where the
property is situated
If, after trial, the court finds merit in
JUDICIAL
the petition, itFORECLOSURE
will render judgment
ordering
UNDERthe mortgagor/debtor
RULE 68, to
pay the obligation
RULES OF within
COURT a period
not less than 90 nor more than 120
days from the finality of judgment.
 II. The court will conduct III. Within this 90 to
I. The mortgagee
a trial. 120 day period,
should file a
petition for judicial the mortgagor has
foreclosure in the the chance to pay
court which has the obligation to
jurisdiction over the prevent his
area where the property from
property is situated being sold.

JUDICIAL FORECLOSURE
UNDER RULE 68,
RULES
This OF the
is called COURT
EQUITY
OF REDEMPTION PERIOD.
 II. The court will conduct III. Within this 90 to
I. The mortgagee
a trial. 120 day period,
should file a
petition for judicial the mortgagor has
foreclosure in the the chance to pay
court which has the obligation to
jurisdiction over the prevent his
area where the property from
property is situated being sold.

After the confirmation of the

JUDICIAL FORECLOSURE
sale, the purchaser shall be
UNDER
entitled RULE
to the 68, of
possession
RULES
the property,OF COURT
and all the IV. If mortgagor
rights of the mortgagor with fails to pay
respect to the property are within the 90-
severed or terminated. 120 days given
to him by the
court, the
property shall
be sold to the
V. There will be a highest bidder
judicial confirmation at public auction
of the sale. to satisfy the
judgment.
The equity of redemption period actually extends until the
sale is confirmed.
Even after the lapse of the 90 to 120 day period, the
mortgagor can still redeem the property, so long as there has
been no confirmation of the sale yet.
Therefore, the equity of redemption can be considered as the
right of the mortgagor to redeem the property BEFORE the
confirmation of the sale.

Notwithstanding Act 3135, juridical persons whose property is

being sold pursuant to an extrajudicial foreclosure, shall have the
right to redeem the property in accordance with this provision until,
but not after, the registration of the certificate of foreclosure sale
with the applicable Register of Deeds which in no case shall be more
than three (3) months after foreclosure, whichever is earlier.

Owners of property that has been sold in a foreclosure sale

prior to the effectivity of this Act shall retain their redemption
rights until their expiration.
 II. The court will conduct III. Within this 90 to
I. The mortgagee
a trial. 120 day period,
should file a
petition for judicial the mortgagor has
foreclosure in the the chance to pay
court which has the obligation to
jurisdiction over the prevent his
area where the property from
property is situated being sold.

JUDICIAL
This is the FORECLOSURE
general rule in
judicialUNDER RULE 68,
foreclosures there
is noRULES
right ofOF COURT
redemption IV. If mortgagor
after the sale is fails to pay
confirmed. within the 90-
120 days given
to him by the
court, the
VI. After the property shall
confirmation of the be sold to the
sale, the mortgagor V. There will be a highest bidder
does not have a judicial confirmation at public auction
right to redeem the of the sale. to satisfy the
property anymore. judgment.
 II. The court will conduct III. Within this 90 to
I. The mortgagee
a trial. 120 day period,
should file a
petition for judicial the mortgagor has
foreclosure in the the chance to pay
court which has the obligation to
jurisdiction over the prevent his
area where the property from
property is situated being sold.

JUDICIAL FORECLOSURE
VII. The proceeds of the UNDER RULE 68,
sale of the property RULES OF COURT IV. If mortgagor
will be disposed as
fails to pay
follows:
within the 90-
120 days given
to him by the
court, the
VI. After the property shall
confirmation of the be sold to the
sale, the mortgagor V. There will be a highest bidder
does not have a judicial confirmation at public auction
right to redeem the of the sale. to satisfy the
property anymore. judgment.
A. First, the costs of the sale will be deducted from the price at
which the property was sold
B. The amount of the principal obligation and interest will be
deducted
C. The junior encumbrances will be satisfied
D. If there is still an excess, the excess will go back to the
mortgagor.
In mortgage, the mortgagee DOES NOT get the excess
(unlike in pledge).
E. If there is a deficiency, the mortgagee can ask for a
DEFICIENCY JUDGMENT which can be imposed on other
property of the mortgagor.
 II. The court will conduct III. Within this 90 to
I. The mortgagee
a trial. 120 day period,
should file a
petition for judicial the mortgagor has
foreclosure in the the chance to pay
court which has the obligation to
jurisdiction over the prevent his
area where the property from
property is situated The purposeis to give being sold.
concession to thebanks.
JUDICIAL FORECLOSURE
VIII.Forjudicialforeclosure,t
Withjudicial
VII. The proceeds of the he redemption
UNDER RULE 68,
foreclosurewhereintheredem
period is within one
ptionRULES OF COURT
sale of the property
priceis the IV. If mortgagor
will be disposed as year.
originalprice.Inthiscase, you fails to pay
follows:
within the 90-
have to pay more when
120 days given
redeeming froma bank. to him by the
court, the
VI. After the property shall
confirmation of the be sold to the
sale, the mortgagor V. There will be a highest bidder
does not have a judicial confirmation at public auction
right to redeem the of the sale. to satisfy the
property anymore. judgment.
 II. The court will conduct III. Within this 90 to
I. The mortgagee
a trial. 120 day period,
should file a
petition for judicial the mortgagor has
foreclosure in the the chance to pay
court which has the obligation to
jurisdiction over the prevent his
area where the property from
property is situated being sold.

JUDICIAL FORECLOSURE
VIII.Forjudicialforeclosure,t
VII. The proceeds of the he redemption
UNDER RULE 68,
sale of the property period is
RULES OFwithin
COURT one
IV. If mortgagor
will be disposed as year.
fails to pay
follows:
within the 90-
120 days given
to him by the
court, the
VI. After the property shall
confirmation of the be sold to the
sale, the mortgagor V. There will be a highest bidder
does not have a judicial confirmation at public auction
right to redeem the of the sale. to satisfy the
property anymore. judgment.