Withdrawal or suspension of a forced sale

When a loan has not been paid off after a payment challenge and 105 days have passed since the first unpaid due date, a request for a forced sale of the property is sent to the District Commissioner’s office (Sýslumaður). Auctions are advertised at least three days in advance on their website. See more on forced sales at the District Commissioner's office.

It is possible to withdraw or postpone a case at certain stages of the process. For more information you can contact one of our consultants by phone, by an email to innheimta@hms.is or in person at our office in Borgartún 21, Reykjavík.

If there are other creditors on the forced sale request, you must also apply for a withdrawal or postponement from them.

Withdrawal of a forced sale request

Until the final sale, the request can be withdrawn at any time during the forced sale process.

In most cases, HMS will accept a request for a withdrawal provided you can pay 50% of the debt.

Suspension of a forced sale process

After a forced sale request has been sent to the District Commissioner’s office (Sýslumaður), the case is heard by them. There are three hearings and they are usually called:

• Enforced auction (first hearing).

• Enforced auction (second hearing).

• Sale by enforced auction (final hearing). Takes place on the property itself.

After the first hearing you can ask HMS to postpone the enforced auction provided you pay at least 15% of the arrears. If the process goes back to the enforced auction stage you can ask for a postponement again, provided you have been paying the monthly due dates on time since the first postponement, plus at least 15% of the arrears.

The final hearing must take place within a year from the second hearing and therefore the postponement has to be within that time limit and can not be postponed more often than that.

Other conditions for a withdrawal or suspension

HMS can request a higher payment or that debt should be paid in full if:

• You are not living in the property.

• It was difficult to present a payment challenge.

• You have previously received a withdrawal from an auction case and did not enter into a payment agreement for the remainder of the debt or did not comply to such an agreement.