How to Redeem the Property That Secures the Debt
Many states offer the right of redemption for homeowners whose home loans have been foreclosed upon. Redemption means the homeowner has the right to pay in full the amounts due on the property after foreclosure and retain the home. Homeowners should try to redeem early in the redemption period, because interest accrues quickly. Success is not assured, either.
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Instructions
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Contact your town clerk, assessor or recorder's office to find out how long you have to redeem your property. It may be as little as two months or as much as 12 months. Provide proof that you owned the home and you're within your redemption period.
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Request from the clerk your redemption payoff amount. The sheriff also may have this information, if a sheriff's foreclosure sale was conducted. Verify that the payoff amount includes a "good-until" date, which means the payoff amount won't increase until that date passes. It should also include taxes and interest charges, as well as other applicable fees.
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Wait to receive the redemption notice, and verify the amount due.
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Make your payment in full via the instructions on the letter. Do not make a payment to anyone other than the person, company or town official stated on the letter. Homeowners frequently make payments to the town clerk or assessor directly. It must be paid in full and on or before the due date.
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Verify that the deed has been transferred to your name and you are the home's owner. The foreclosure will be rescinded. Make payments on your loan, if applicable, in a timely fashion.
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Tips & Warnings
Be sure to secure a lien release from secondary lienholders in advance of the redemption. Otherwise, you may be subject to a lender lawsuit. Redeem your property as quickly as possible. Interest accrues quickly and may be as high as 20 percent, according to IRS guidelines.
