Compulsory sale

This page contains more details on what compulsory sale entails and how the case is dealt with.

What is a forced sale?

When a property is subject to forced sale, it is the Court and not the owner that carries out the sale of the residence. The reason the sale is forced is that the owner has failed to service his debt. The property is sold following a petition by one or more creditors with, for example, a mortgage on the property because the owner (debtor) has defaulted on the mortgage debt. The Court usually has an attorney or estate agent to assist with the sale.

A creditor may petition for the forced sale of a property when there is a legally enforceable basis for execution (such as attachment, mortgage bond and statutory charge).

A petition for forced sale must contain

  • name of party, date of birth/business registration number and address

  • address of the object for which a forced sale has been petitioned as well as the object's registry name (for example, organisation number and share number or property number/title number/building section number)

  • overview of the monetary claim (primary claim, interest, interest rate and costs)

  • description of the basis for execution

 

A petition for forced sale must include the following appendices:

  • Notice of enforcement pursuant to Section 4-18 of the Norwegian Enforcement Act. This must be older than 14 days.

  • Certified copy of the land register, which is not older than 3 months. (Does not apply to shared ownership flats).

  • Copy of the basis for execution.

Four complete dated and signed copies of the petition with appendices must be submitted.

Case procedure

The Court submits the petition for forced sale to the person who is being sued. The deadline for commenting, and submitting, if applicable, a petition for replacement housing, is 1 month from the service of the petition. Any objections the Court receives to the petition received by the Court shall be sent to the plaintiff for a statement. In most cases, the Court takes a position on the dispute based on the written statement of case.

If there are no objections or petition for replacement housing, the petition for forced sale will be decided by a decision. In the decision, the Court decides whether the forced sale is to be conducted as an auction sale or with the help of an assistant.

If the defendant wishes to pay all or part of the claim, he must contact the plaintiff or the plaintiff's attorney (counsel). If the entire claim is redeemed, the plaintiff will withdraw the petition. In cases where the defendant can pay part of the claim, he may attempt to enter into a payment agreement with the plaintiff's counsel. The plaintiff will then petition for a postponement of the case. The plaintiff will be able to petition for resumption of the case if the payment agreement is not complied with.

How does the sale take place?

The vast majority of sales are conducted with the use of an assistant (attorney or estate agent). The property or flat is advertised for sale in newspapers and on-line like an ordinary home sale. Showings are also held and the sales process is the same as for an ordinary home sale. While the advertisement does not state that it is a forced sale, this is explained in the sales description. Once common, enforced auctions are no longer practised.

The sale ends when the Court confirms an offer by ruling and distributes the purchase price to the rightful claimants by priority. The debtor receives any money that is left over. 

It is worth noting that before the confirmation ruling is pronounced, the plaintiff is entitled to revoke the petition at any time.

Even though the Court has decided to carry out an assisted sale and appointed an assistant, it is still possible for the defendant to sell his residence voluntarily. In that case a petition should be submitted to postpone the ongoing forced sale.

Eviction during forced sale

In cases where the defendant does not cooperate with the assistant in the sales process, the plaintiff may petition for the eviction of the defendant from the residence,  See Section 11-14 of the Enforcement of Judgments Act on lovdata.no.

Appeal

Both 1) a decision on a forced sale and 2) a ruling on confirmation and distribution may be appealed to the Court of Appeal. The appeals deadline for the ruling that confirms an offer is 1 month. The deadline is calculated from the pronouncement of the ruling. The appeals deadline for the ruling that distributes the purchase price is 1 month. The deadline is calculated from the service of the ruling. The appeal is submitted to the Court together with the appeal fee.