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Foreclosure / Repossession

Foreclosure

Foreclosure is a process which begins when a consumer defaults on his or her mortgage payment(s).  When a home “goes into foreclosure” it means the mortgage holder has begun the process of taking possession of the home because they have an interest in the home which was secured by the mortgage which the homeowners signed.

There are two kinds of foreclosure in Minnesota, one is foreclosure by action and the other is foreclosure by publication.  With foreclosure by publication, the mortgage holder is required to publish the foreclosure notice in the local newspaper continuously for six weeks.  This published notice includes a sheriff’s sale date, notice of which is served on the homeowner by the local sheriff.

The sheriff’s sale is not a formal process during which the sheriff comes to your home and lets strangers bid on the home. It takes place at the sheriff’s office and most times, the holder of the first mortgage on the home purchases the home for the amount of the mortgage.

After the sheriff’s sale, the homeowner has a period of six months in Minnesota to “redeem” the mortgage.  This means that they have six months to come up with the money to pay the mortgage holder and become current on the mortgage, thus keeping possession of the house.  During these six months however the amount the mortgage is in arrears goes up almost daily with interest amounts and attorney’s fees.

Even if the homeowner cannot come up with the funds to redeem the mortgage, they can still legally remain in the home for those six months because under Minnesota law they still own the house for those six months.