Minnesota Foreclosure Laws
Expected Timeline: Two to three months
Security Instrument: Mortgage or Deed of Trust
Type of Process: Judicial or nonjudicial
Protections for Servicemembers: Minn. Stat. § 72A.20(8)(b),(c)
Time to Respond: Notice of sale must be published six weeks before scheduled sheriff sale. Notice must also be served on homeowners at least four weeks before auction date.
Reinstatement Period: Loan may be reinstated any time before auction.
Protections for High-Cost Mortgages: None.
Redemption Period: Former owners may stay in property and redeem for six months after sheriff sale.
Eviction Process: One month after eviction ends, new owner may give one month’s notice. Then an eviction lawsuit may be filed.
Deficiency Judgments: Deficiency judgments are not available in nonjudicial foreclosure with a six month redemption period.
Limits on Deficiency Judgments: Deficiency allowed, but limited by fair market value determined through a jury trial. If nonjudicial foreclosure is used and the six-month redemption period is available, no deficiency is allowed.
Cash Exempted in Bankruptcy: $11,000 for single person, $22,000 for married couple.
State Statutes: Minn. Stat. § 580.01 to 580.30
In Minnesota , either the Non-Judicial or Judicial Foreclosure process may be used when a borrower has defaulted on a loan.
The Judicial Foreclosure process is used in the absence of a power of sale clause in the original loan documents. The lender must sue the borrower in court to obtain an order to foreclose on the property.
The Non-Judicial Foreclosure process may be used if the loan documents contain a power of sale clause, authorizing the lender to sell the property if the borrower defaults. Also, no lawsuit must have been filed to collect the delinquent amount, and the mortgage and any assignment of the mortgage to a new lender must have been recorded. If the property is a homestead, the notice of intent to foreclose must be given at least eight (8) weeks prior to the foreclosure process being initiated. If the power of sale clause specifies the time, place, and terms of the sale, then those details must be adhered to.
The sale process in Minnesota begins with the recording of the notice of sale with the county clerk. The notice must contain the borrower and lender information, as well as the original amount of the mortgage, amount that is delinquent, and the time, date, and place the sale is to be held at.
For six (6) consecutive weeks before the sale, the notice must be published in a newspaper of general circulation in the county in which the property is located. The notice must be served to the borrower at least four (4) weeks prior to the sale.
The county sheriff conducts the sale as a public auction. The sheriff or a deputy must read aloud a statement filed by the lender which includes an itemization of the amounts due. The high bidder for the property receives a certificate of sale at the auction.
The redemption period in Minnesota is up to one year after the sale. The borrower must pay the delinquent amount plus costs in order to redeem the property.
A deficiency judgment may be pursued by the lender. The lender can sue the borrower for the difference between the fair market value of the home or the sale price and the balance of the loan.
State Website: www.leg.mn.state.us/leg/statutes.asp