Your Rights as a Tennessee Homeowner Facing Foreclosure

Here’s something that drives us a little crazy. Almost every homeowner we talk to — whether they’re in Bearden, Fountain City, South Knoxville, or way out past Powell — thinks the bank holds all the cards once foreclosure starts. They don’t. You’ve got rights. Real ones. Written into Tennessee law.

The problem is nobody tells you about them until it’s almost too late.

Mark sat down with a retired teacher in Halls last spring. She’d already accepted she was losing her house. Had a moving date picked out and everything. When he walked through what Tennessee law actually guarantees her, she started crying. Not because the news was bad — because nobody had told her any of it before.

So here are six rights every Tennessee homeowner needs to know. Before you make a single decision about your property, read these.

(Standard disclaimer: we’re not attorneys and this isn’t legal advice. But this is stuff your lender definitely isn’t going to volunteer.)

Do I Have the Right to Be Notified Before Foreclosure?

Yes. Tennessee law requires your lender to give you written notice before they can move forward with anything. On top of that, before they schedule a sale, they have to publish a notice of foreclosure in a local newspaper for at least three consecutive weeks. In Knox County, that means a Knoxville-area publication.

This matters more than you think. If you haven’t received proper written notice? The foreclosure might not even be legal.

Keep every letter. Every email. Every notice you receive. Shove them in a folder, a shoebox, whatever — just don’t throw them away. That paper trail is your evidence if something doesn’t add up later.

We’ve seen lenders in this area skip steps. It happens. And when it does, the homeowner has leverage they didn’t know they had.

Can I Stop Foreclosure by Catching Up on Payments?

In many cases, yes. Tennessee homeowners have what’s called the right to “cure” — basically, you catch up on everything you missed (payments, late fees, legal costs) and your loan goes back to normal. Like the default never happened.

This works best early. If you’re in the first 30 to 60 days of missed payments, reinstatement is usually your cleanest path. The further you get into the process, the more fees pile on top, and the harder it gets to catch up.

Tennessee homeowners have the right to "cure" -- catch up on missed payments, late fees, and legal costs to stop foreclosure and restore your loan to normal. This works best in the first 30 to 60 days.

But here’s the thing — even if you’re deep into it, this right doesn’t just disappear. Contact your lender’s loss mitigation department directly and ask about reinstatement. You can also call a HUD-approved housing counselor at 1-800-569-4287 for free guidance. They’ll tell you exactly where you stand.

Ty helped a homeowner near Inskip who scraped together reinstatement money from three different family members. Took about two weeks of phone calls and some creative budgeting. But it worked. She kept her house. That was almost two years ago and she’s still current on payments.

What Are Surplus Funds and Am I Entitled to Them?

This one surprises people every time.

If your home sells at foreclosure auction for more than what you owe, that extra money is legally yours. The difference between the sale price and your total outstanding balance — mortgage, fees, costs, all of it — that surplus belongs to you.

And here’s the part that really gets us: a lot of Knox County homeowners never claim it. They don’t even know it exists. The money just sits there.

To check for surplus funds after a foreclosure sale, contact the Knox County Trustee’s Office at 865-215-2305 or walk into their office at the City County Building on Main Avenue downtown. Ask specifically about surplus funds from your property’s sale. If there’s money, they’ll tell you how to claim it.

Surplus funds from a foreclosure auction are legally yours. Many homeowners never claim them. Contact the Knox County Trustee's Office at 865-215-2305 to check if you are owed money.

We’ve personally told homeowners about surplus funds they were owed. One family near Karns had almost $11,000 sitting with the Trustee’s Office. They had no idea.

Can I Challenge or Fight a Foreclosure in Tennessee?

Yes. If your lender didn’t follow proper legal procedures, you may have grounds to challenge the entire foreclosure in court. Common issues we’ve seen include:

• They didn’t provide adequate notice
• They violated the terms of your mortgage contract
• They miscalculated the amount owed
• They didn’t publish notice properly or for long enough

This is one of those areas where talking to an actual attorney makes a real difference. Legal Aid of East Tennessee at 865-637-0484 offers free legal help to qualifying Knox County residents. If you think your lender cut corners, that phone call is worth making.

We don’t pretend to be lawyers. But we’ve seen enough deals where the lender made mistakes that we always tell people: check the paperwork. It costs you nothing to look.

How Long Can I Stay in My Home During Foreclosure?

Until the foreclosure sale is finalized, you have the legal right to stay. Nobody — not your lender, not a debt collector, not some random real estate agent who shows up at your door — can force you out before that. Not without a completely separate legal eviction process.

This right gives you something you probably feel like you don’t have right now: time.

Time to explore a loan modification. Time to work out a forbearance plan. Time to look into a short sale or a direct cash sale to a local buyer. Time to actually think instead of just react.

Homeowners in Halls, Bearden, West Hills, Powell, and all across Knox County should use this window to weigh every option carefully. The auction date is a deadline, not a death sentence. A lot can happen between now and then if you make some calls.

Are Military Members Protected from Foreclosure?

Yes — and the protections are stronger than most people realize. The Servicemembers Civil Relief Act (SCRA) gives active duty military members the ability to delay foreclosure proceedings during their service and for a period after. It can also cap your mortgage interest rate at 6% while you’re active duty.

If you’re an active duty service member, reservist, or recently returned veteran anywhere in the Knoxville area — including folks connected to McGhee Tyson Air National Guard Base — these federal protections may apply to your situation. Contact your installation’s legal assistance office or the Tennessee Department of Veterans Services for guidance.

Reid’s grandfather served, and this one is personal for us. If you’ve served this country, you deserve to know every protection the law gives you. Don’t leave those on the table.

Where Can Knox County Homeowners Get Free Help?

You don’t have to handle this alone. There are real people right here in Knox County who will help you for free:

Resource	Contact	What They Offer
HUD-Approved Housing Counselor	1-800-569-4287 or hud.gov	Free foreclosure prevention counseling
Legal Aid of East Tennessee	865-637-0484	Free legal assistance for qualifying residents
Tennessee Housing Development Agency	thda.org	State homeowner assistance programs
Knox County Trustee’s Office	865-215-2305	Property tax info, surplus funds
Knox County Register of Deeds	865-215-2330	Property records, deed verification
211 Tennessee	Dial 211	Housing, utilities, and emergency assistance

That’s a lot of free help sitting right there. Use it.

Take the First Step Today

“Knowing your rights matters. But it doesn’t save your house by itself. Action does.”

If you’re facing foreclosure in Knox County, pick up the phone. Call one of the resources above. Or call us — Volunteer Home Buyers at (865) 324-1736. You’ll talk directly to Reid, Ty, or Mark. We grew up in Knoxville, we’ve done this hundreds of times, and we’ll help you figure out the best path forward — whether that’s keeping your home, selling it, or working something out with your bank.

No pressure. No judgment. Just a straight conversation about what’s actually possible.