If you fall behind on your house payments in Nebraska, the bank can’t initiate foreclosure proceedings immediately. Federal law typically gives you 120 days to bring the loan current or find another way to avoid losing the home.
But if you're not able to get paid up or work out a foreclosure alternative, the bank can start foreclosure proceedings. In this article, you’ll learn about Nebraska foreclosure laws.
What Are My Foreclosure Rights Under Federal Law?
Banks and mortgage companies use the foreclosure process to sell your home if you fall behind on your payments. Fortunately, federal law gives most homeowners facing foreclosure some time to deal with the situation before the foreclosure can begin. The servicer generally can't proceed until the payment is more than 120 days past due. (12 C.F.R. § 1024.41 (2025).)
During this preforeclosure period, you can get caught up by paying the overdue amount in one lump sum (called "reinstating" the loan) or apply for another option. For example, you might be able to lower your monthly payment through a loan modification or dispose of the property in a short sale or deed in lieu of foreclosure.
What Types of Foreclosure Are Allowed in Nebraska?
In Nebraska, the bank can foreclose either judicially (in court) or nonjudicially (out of court). Here’s a general description of both types of foreclosure.
How Judicial Foreclosures Work
A judicial foreclosure starts when the bank files a lawsuit and serves it on the borrower. If the borrower fails to respond (ignores it), the bank will win by default (automatically).
However, if the borrower answers the complaint, the bank must prove that it’s entitled to foreclose before it can get an order allowing it to sell the home at a foreclosure sale.
How Nonjudicial Foreclosures Work
In a nonjudicial foreclosure, the bank doesn’t need the court’s approval before selling the home at a foreclosure sale. Instead, the bank goes through a series of steps described in Nebraska law. After completing the steps, the bank sells the house at a foreclosure sale.
Most banks use the nonjudicial process because it’s quicker and cheaper than going through the court system.
How Does the Nonjudicial Foreclosure Process Work in Nebraska?
Nebraska homeowners typically receive two foreclosure notices in a nonjudicial foreclosure: a notice of default and a notice of sale. The borrower must make a formal request to receive the notices. (Neb. Rev. Stat. § 76-1008 (2025).) For most, this isn't a problem because Nebraska deeds of trust commonly contain a clause that acts as a formal request on the borrower’s behalf.
Notice of Default
To start the foreclosure, the trustee records a document called a “notice of default” in the county records. The trustee then mails a copy to the borrower within ten days after recording. The notice gives the borrower one month to bring the loan current (or two months if the property is used in farming operations and isn't located in any incorporated city or village). (Neb. Rev. Stat. § 76-1008, Neb. Rev. Stat. § 76-1006, Neb. Rev. Stat. § 76-1012 (2025).)
Notice of Sale
After the deadline to bring the loan current passes, the trustee will publish a notice of sale in a newspaper at least five times, once per week for five consecutive weeks, and will mail a copy to the borrower at least 20 days before the sale. (Neb. Rev. Stat. § 76-1007, § 76-1008 (2025).)
Reinstating the Loan in a Nebraska Foreclosure
You can “reinstate” your loan and stop the foreclosure process by paying all missed payments, fees, and costs in one lump sum. After reinstatement, the bank cancels the foreclosure, and you resume making your regular monthly payment.
Again, under Nebraska law, the borrower gets one month (two if the property is agricultural) to reinstate the loan after the trustee records the notice of default. (Neb. Rev. Stat. § 76-1006 (2025).) Also, most Nebraska deeds of trust permit the borrower to reinstate the loan up to five days before the sale.
Does Nebraska Allow a Deficiency Judgment Following a Nonjudicial Foreclosure?
If the foreclosure sale proceeds don’t fully repay the mortgage debt, the outstanding balance is known as a "deficiency." After a nonjudicial foreclosure in Nebraska, the bank can sue the borrower to obtain a judgment (called a "deficiency judgment") for this amount. The bank can collect the judgment using methods such as garnishing wages or levying a bank account.
The bank must file the deficiency suit within three months of the foreclosure sale. Additionally, the outstanding amount must be the lesser of:
- the difference between the total debt and the foreclosure sale price, or
- the difference between the total debt and the home's fair market value. (Neb. Rev. Stat. § 76-1013 (2025).)
Does Nebraska Have a Redemption Period for Foreclosure?
Nebraska law doesn’t allow a foreclosed homeowner to “redeem” the property (buy it back) after a foreclosure sale. (Neb. Rev. Stat. § 76-1010 (2025).)
Talk to a Local Nebraska Foreclosure Lawyer
While this article provides an overview of a typical foreclosure in Nebraska, remember that state and federal foreclosure laws are complicated, and cases can proceed differently depending on the circumstances. Also, servicers and banks sometimes make mistakes or skip steps, but most foreclosure errors go uncontested. In cases where the servicer or foreclosing bank omitted a required step, made an error, or violated state or federal foreclosure laws, you could have a defense that could force it to start the foreclosure over, or you might have leverage to work out an alternative.
If you believe your rights were violated, talk to a local foreclosure attorney or legal aid office immediately. A lawyer can give you information about different ways to fight the foreclosure in court, as well as information about different ways to potentially avoid foreclosure. If you can't afford to hire a lawyer, Legal Aid of Nebraska provides free legal assistance to qualifying homeowners.
A HUD-approved housing counselor can also provide helpful information (at no cost) about ways to prevent a foreclosure.