Foreclosure in Minnesota, and How to Avoid It
If you are entering the stages that can end in foreclosure on your home, the most important thing is to get to work on it, now. Yes, it is painful, but if you can endure a little bit of pain now, you will avoid a great deal of pain down the road. A foreclosure on your credit report will prevent you from getting a home loan from a bank for at least three years. You have options.
Here are the steps in the Minnesota foreclosure process that you want to stop, the earlier the better:
- You miss a payment and receive a phone call and a letter from your bank.
- If there is no response or payment, you receive a default/intent to foreclose notice.
- If still no resolution, the bank forwards your account to a foreclosure attorney.
- Foreclosure attorney schedules Sheriff’s sale and publishes a notice for 6 weeks.
- Four weeks before the sale, you are served with a notice of the Sheriff’s sale.
- The Sheriff’s sale date is your deadline to bring your mortgage current.
- For six months after the Sheriff’s sale, you maintain the right to stay in your home.
To redeem the property, you must pay off the entire Sheriff’s sale price plus interest.
For a wealth of helpful information and tips, contact the Minnesota Homeownership Center at (866) 462-6466 or http://www.hocmn.org
But here are some tips on how to arrest and reverse the process.
In most cases your bank does not want the foreclosure to go through. They want you to get back on track and resume a long term relationship. To accomplish this goal, most banks have a Loss Mitigation Department where you might work out a solution. Example solutions would be a repayment plan for the past due amount or a loan modification agreement that reduces your monthly payment. Most banks are sympathetic with your situation. They want to work with you. Get in touch with them and get a conversation going, the earlier the better.
Another solution is called a “short sale.” If you owe more money on your home than its current market value, many banks might allow you to sell the property for whatever selling price you can get, then let you out of your mortgage for that amount of money.
Under a short sale, because you have sold your home, you cannot stay in it. And you are not allowed to rebuy the house after the short sale. The advantage is that you will have avoided foreclosure which would have prevented you from getting another mortgage for at least three years. Under a short sale, you only have to wait six months to apply for a new mortgage.
Homestead Road can make the short sale process easy, fast, and painless by negotiating a cash offer for the house that is acceptable to the bank. We will make an offer within 24 hours, and take care of all the paperwork.
If you are unable to work something out with the bank and the foreclosure goes through, all is not lost. You can still finance another house after foreclosure without having to wait two years for FHA or three years for a conventional. Through Homestead Road you can still realize the dream of home ownership through a variety of non-bank financing options that we offer. Click here to find out more about your options
Whether lease to own, rent to own, or contract for deed, you move into the home and make monthly payments just like with a mortgage. In this way you establish your ability to stay on a monthly payment schedule. Then after a period of 1-3 years, you are in a stronger position to qualify for refinancing with a conventional mortgage and acquire the deed for the home.
In time, even the worst credit will heal, especially if you’re in a comfortable position financially and able to pay your bills on time. We will be sure that when you move in, you’re in that comfortable position with a payment you can afford.
With lease-to-own or rent-to-own, you simply pay a security deposit and one month’s rent in advance, then move into your future home. Under a contract for deed, all that is required of you is a reasonable down payment, the willingness and ability to care for and maintain a home of your own. And unlike banks, we don’t care where your down payment comes from. In this way Homestead Road is a modern day “homesteading” solution for families who are finding it increasingly difficult to secure conventional mortgage financing.
Our mission is to serve the market better, which means we have to serve people better. If we succeed, we will be rewarded. For more about our mission, click here.
For more information on Homestead Road visit us at https://homesteadroad.com