Foreclosure Cottage Grove MN is a legal action in which the lender can take possession of the property for which a mortgage was acquired to purchase. The process has several steps during which the homeowner has a limited amount of time to take action. The first step is repossession; the lender notifies the homeowner that he or she has defaulted on the loan and is otherwise in danger of losing a claim on the property. Click here for more information.
How to Avoid Foreclosure
The homeowner, once notified by the lender has a small window of time to prevent foreclosure. This is usually a six-month period referred to as a redemption period. Typically, this window of time is adjusted based on a sheriff’s sale of the property in which the official is required to post ads in the local newspaper to advertise this sale for a predetermined amount of time.
During this redemption period, the homeowner can redeem the property by submitting payment for all outstanding balances that have accumulated and caused the default. Under Minnesota law, any homeowner who is one month behind on their mortgage payments can default on the loan.
Forbearance
Homeowners who have defaulted due to termination from their job or a temporary delay can submit a request with their lender for a forbearance. The homeowner would qualify for this action, if he or she meets the guidelines set forth by the lender. It allows them to stop payments for an established amount of time in which they will not accumulate late charges.
Refinancing the Property
The homeowner may acquire a new mortgage from a different lender to refinance the property. This will allow him or her to pay off the original lender in full. While this can prevent foreclosure, the homeowner’s credit is affected by the attempted foreclosure and late payments. This could affect their credit score and result in a higher interest rate on the loan overall.
If the original lender believes in good faith that the homeowner will remedy the tardiness of payments or prevent a re-occurrence of these late payments the lender may choose to refinance the loan themselves. Any homeowner who is facing Foreclosure Cottage Grove MN can acquire legal assistance and advice through the Lamey Law Firm to determine which avenue is right for them.
