For those of you that are having trouble paying your mortgage this information is for you. This is the Minnesota Foreclosure Process and what you can expect. This article is taken from our handbook "What you need to know about foreclosures", we distribute this handbook to all our clients that are facing foreclosure and to other Realtors that take our Foreclosure Classes for their required Continuing Education.
The Foreclosure Process:
There are two ways for a lender to foreclose on a mortgage. The judicial process and the non-judicial process. The process used by the lender depends on the laws in each state. Some states are judicial only and some states allow both judicial and non-judicial.
The judicial process is a court directed action and like many things through the courts it becomes complicated and expensive. When a state allows non-judicial, which is foreclosure by advertisement, the lenders will use this process because it is simpler and less expensive. Minnesota allows foreclosure by advertisement and almost all mortgage foreclosures here are done this way.
Foreclosure By Advertisement:
When a lender forecloses a mortgage by advertisement they engage an attorney to act on their behalf. the attorney in essence becomes a third party debt collector for the lender. The attorney will file the necessary documents in the county where the property is located and begin the advertisement period. In the state of Minnesota the minimum advertisement period is once per week for six consecutive weeks. Once the advertisement period is completed a mortgage foreclosure sale is held.
The Sale:
the mortgage foreclosure sale, more commonly known as the Sheriff's Sale, is a public auction conducted by the Sheriff's department at the county courthouse. Although it is a public auction most of the time only the attorney for the lender submits a bid. The successful bidder at the sale received title to the property in the form of a Sheriff's Certificate; however they do not receive possession of the property until after the redemption period.
The Redemption Period:
In the state of Minnesota, the homeowner's redemption period is for six months after the Sheriff's Sale; There are special circumstances that allow up to twelve months for some properties; but most residential properties only get six months. during this six-month period the homeowner keeps possession of the property and has the right to redeem title by paying off the grantee of the Sheriff's Certificate. During the redemption period the homeowner has full rights to the property. They may live in it, rent it, refinance (even though most lenders will not choose to give loans at this point in the foreclosure and if they do the monthly payment will be greater then the previous payments that the homeowner was having difficulty in paying) or sell the property. If they do not redeem title within the six-month period they then lose all rights to the property and must vacate the premises.
What Usually Happens:
The biggest difficulty most people in foreclosure face is lack of knowledge about the foreclosure process. Many do not understand te process, they don't know what the redemption period means and they don't know what their options and rights are before the sale or after the sale, and ultimately they loose their home and any chance to help save their credit. Unfortunately their lenders and the lenders attorney will not assist the homeowner's or educate the homeowner as to their rights and in most cases the homeowner can not afford an attorney of their own to help them create a strategy for dealing with their foreclosure or educate them.
This is where we come in. We will take the time to inform the homeowner as to their rights and options at NO COST or obligation for this information. If the only option the homeowner has or wants is to sell their property, then we hope that the homeowner will see the benefits of using The Janos Group and Remax Specialists to market their property quickly and for as much equity in the allotted time.
Please watch for the next few issues of our blog where we will discuss:
- What are the homeowners options
- Selling a property in foreclosure
- What to do if you have no equity
- How to choose a Real Estate Consultant to sell your foreclosure property
If you would like a copy of our handbook "What you need to know about foreclosures" mailed or emailed to you please visit us at www.TheJanosGroup.com and click the link for "The Janos Group's Foreclosure Handbook" or feel free to contact us with any questions you may have.
Or handbook has a list of Government Agencies that help people in foreclosure.
The Janos Group
ReMax Specialists
4910 Highway 61
White Bear Lake, MN 55110
651-407-7803 Office
651-407-7804 Fax
Tom@TheJanosGroup.com
www.TheJanosGroup.com
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