I recently read that if I purchase a foreclosed property from an auction in my state, I would have to wait for the 12 month redemption period, or try to shorten the wait before doing anything with the property. Does this period also count when purchasing a property through a lending company such as a bank?
Answer:
Depending on your state, the redemption period is either before the auction or after the auction so to speak. You need to find out which is the case for your state…
Generally speaking, if you use trust deeds as you instrument of security, then the redemption period is before the auction. So when it foreclosures, it becomes the banks and they turn around and list it with their listing agent of record.
If your state is a mortgage state, the redemption period is after the auction. The redemption period varies within states as well. Could be 3 months, could be 6 months or even more after the auction.
If you purchase through a bank, they have already been through the redemption period process (whatever that might be) so that way they can issue you a clean title. Whatever you do, DO NOT do anything to the property before this period is over.
Good Question. The answer should be NO, the lender has received the property back either through the courts, or by the same method as you would have, had you purchased at an Auction. This is now referred to as REO(Real Estate Owned). Like you, they must wait the year in order to sell the property to someone else if there is a “Right Of Redemption” in your state. Ever wonder why you’ve seen houses vacant for so long, then all of a sudden sold the next day?… Most likely they were waiting out the “Right of Redemption” timeline.
So if you see it posted as an REO with a Bank or Lender, you can probably buy it.
Hope this Helps
My home went into foreclosure because I got behind in payments due to a loss of job and divorce. My mortgage company proposed several options, and I was approved for loan restructuring. However, I didn’t receive the paper work in time. Therefore my home went to sheriff’s sale. I had six months to redeem it, but no company would refinance me based on my credit. I also tried a short sale, but the mortgage company refused the seller’s offer. In fear of being homeless, I moved to an apartment a few days before the redemption period expired. Last week, I received a summons to appear in court regarding the eviction from the property. My first inclination was to discard the paper and not go because I no longer reside at the property. However, after doing some research I found out that a judge can overturn not only the eviction but the entire foreclosure process. I don’t have a lawyer because I just got the paperwork and so many people were away on vacation. My case is tomorrow. I really don’t know what to say or do, but if I can get my house back then I want to be able to do so. I’ve Googled and search everywhere and I can’t find any article of the law that states it is possible for me to redeem my property. Please help.
In this situation, more than likely you’re going to need cash to re-instate the loan because you are in the redemption period. You may want to consult with some local attorneys and get their opinion on this.
In Illinois, a mortgagor who is in foreclosure has the right of redemption (90 days) and reinstatement (7 months). If the redemption or reinstatement occurs, is this recorded in the Recorder of Deed’s office> What is this document called in Illinois, e.g. a ‘release’>
Hope someone who knows Illinois law can help me…
Thanks.
A mortgage company wouldn’t file a release after reinstatement of a loan. A release of the mortgage lien would only be filed after paying off the mortgage in full.
You’d have to refinance or sell the home the mortgage company sends you the release, which you then file at the Recorder of Deed’s office yourself.
NO.
The redemtion in Illinois is only valid prior to foreclosure. As long as the homeowner fulfills the mortgage obligations in some way agreed upon with the lender, there is nothing to record because the mortgage payments have been brought current in one way or another. The lender basically stops the foreclosure process.
If the loan was modified etc.. Than the lender would record such a document.
Once a Lis Pend. has been filed and recorded there is nothing that can be done.
Hope this helped!
— JJ —
Does anyone know what is and if there is a right of redemption period after a mortgage foreclosure sale in Texas? we were just notified that our loan went into foreclosure and has been assigned a attorney! we were in the process of a loan modification but that takes 30-45 days to get approved and the sale date is before that! the mortgage company said they will try and put a rush on it but gave us no guaranty that it would be done before the sale date! I am pregnant and would like to keep our home and i don’t know if there is a grace period after the sale that gives you time to move out or if there is a right of redemption period in Texas. Please help!!
As far as I know, Texas redemption rights are before the auction – meaning you can redeem the property anytime before the auction. If there has been a sale date set, the best thing you can do at this point is contact your lender. Ask to talk to the foreclosure department or loss mitigation department. As soon as you get there you will be able to talk to a specialist handling your account. Tell them what is going on and fax them proof that your loan modification will be going through shortly if they just postpone the auction a week or two. Depending on what kind of mood they are in, they may work with you.