Foreclosure Rights Redemption
Many homeowners think the final step in a foreclosure procedure is the auction. In many states, this is not the case. Some homeowners have the right to redeem their property. Redemption rights vary from state to state, although the process of exercising the right is usually the same. If you are facing foreclosure, it is important to be aware of all your rights.
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Foreclosure Requirements
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Redemption rights only apply to homes foreclosed judicially. A judicial foreclosure is carried out through the court. Some states allow lenders to choose whether or not to foreclosure judicially. In other states, such as Florida, judicial foreclosures are mandatory. State foreclosure laws dictate whether or not redemption rights are granted.
Length of Redemption Period
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The redemption period may be before the home is sold through a foreclosure auction or after the home is sold, depending on the state's foreclosure laws. Redemption periods can last from a few days to over a year. Abandoning the property can disqualify you from redeeming the home or shorten the length of time.
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Cost of Redemption
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The redemption price is usually the amount of the highest bid or full balance due on the loan. The homeowner is also required to pay all fees, including interest, attorney fees and lender costs. The payment must be made in full before the redemption period ends.
Redemption Process
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Homeowners who are able to purchase back the home must file a petition to court. Since the review process can take some time, you should file the petition a few days in advance. The petition must state your desire to redeem the home and show your ability to pay. You will need to show proof of funds. A letter from your bank is often sufficient. If you are able to obtain a loan from another lender, present a pre-approval letter. You may also want to submit a copy of your original deed. After the petition is approved, you will need to pay the court the entire balance before the redemption period expires to regain ownership.
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