Foreclosure is the procedure through which the lender in a mortgage takes ownership and/or possession of the property that secured the original loan. This happens when a debtor in Isanti, Minnesota has consistently failed to make their payments. When a house is foreclosed, it is usually sold at auction shortly thereafter. This is because banks usually want to get rid of the property as soon as possible, even if it means losing some money, and an auction is an simple way to do this.
In all states in the United States, including Minnesota, foreclosure by judicial sale is an option. This allows the sale to be done under the supervision of a court, to ensure that the bank makes a good faith effort to get a fair price, and that the proceeds above and beyond the balance of the mortgage (if there are any) go back to the debtor. In some states, original mortgages are "non-recourse loans," meaning that the lender may only recover ownership of the house in the event of default. If the house is now worth less than the balance of the mortgage, the lender has to take the loss. You should speak with an Isanti, Minnesota attorney to see if this state is one of them. However, it is almost always the case that this protection does not apply to loans that have been refinanced.
How Can I Avoid Foreclosure in Minnesota?
First, and most importantly, you should not dismiss the issue. Failing to respond to foreclosure calls from your lender will not make an issue go away. You should stay in touch, and be honest with, your creditor as much as possible. One should remember that banks generally don't want to take your house in Isanti. They issued your mortgage expecting to earn a profit on the interest. Taking possession of, and selling, your house is a last resort for them. Therefore, if you are honest with them about your financial situation, they are likely to make reasonable accommodations to keep you from defaulting.
If you can't work anything out with your lender, or have become totally unable to make any mortgage payments, a "short sale" might be a good option. This allows you to sell your house for whatever price it can get, and hand the proceeds over to the lender. If the sale price is less than the balance of the loan, the rest of the debt may be forgiven. A "short refinance" may also be an option in some cases. This allows you to have some part of the debt forgiven, while refinancing the rest.
How Can A Isanti, Minnesota Attorney Help?
If you are facing the possibility of foreclosure, a good Isanti, Minnesota real estate lawyer can help. At the very least, they will be able to inform you of your legal options.