Foreclosure is the process 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 Mounds View, Minnesota has repeatedly failed to make their payments. When a house is foreclosed, it is typically sold at auction shortly thereafter. This is because banks typically want to get rid of the property as soon as possible, even if it means losing some money, and an auction is an easy 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 conducted 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 can 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 a Mounds View, Minnesota lawyer to see if this state is one of them. However, it is almost always the case that this protection does not apply to loans which have been refinanced.

How Can I Avoid Foreclosure in Minnesota?

Most importantly, you must not ignore the problem. Doing so will not make it go away, and will probably make it worse. You should stay in close contact with your bank, and be forthright with them. It is essential to remember that banks don't really want to own homes in Mounds View. In issuing a mortgage, they expect to make a profit through interest on the loan, and they'd prefer to continue collecting from you. Therefore, they're likely to make reasonable accommodations to your financial situation if it will enable you to keep paying them in the long run.

If you can't work anything out with your lender, or have become completely 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 might be forgiven. You might also consider a "short refinance" which allows a chunk of the debt to be forgiven, and lets you refinance the rest.

How Can A Mounds View, Minnesota Attorney Help?

If you are faced with the possibility of foreclosure in Mounds View, Minnesota, an attorney might be able to help. At the very least, he or she can advise you of your legal options.