| Redemption rights in foreclosure actually only come | | | | that can be retrieved by fixing the property and |
| after the homeowner's property is lost through a | | | | selling it in the retail market. These are called Equity |
| foreclosure sale or action. Once the home has been | | | | Agreements and are common in the real estate |
| lost, some states allow the homeowner the right to | | | | business. Equity Agreements stipulate who gets how |
| "reclaim" his home for varying periods. | | | | much of the proceeds from the sale, who pays what |
| Because of the power the banks have for | | | | expenses and who will be dong the work. |
| foreclosing, some states decided that that | | | | Remember, if it isn't in writing in the Agreement, it |
| homeowners should likewise have the right to reclaim | | | | isn't going to happen. If you have a question, ask an |
| their home if their personal circumstances turnaround | | | | attorney before you sign anything. |
| within a given time period. The homeowner will have | | | | Here are the states that have no redemption period: |
| to petition the court for a hearing to get his home | | | | Arizona, Connecticut, Delaware, Hawaii, Illinois, Iowa, |
| back and show "proof of funds" that he is able to | | | | Louisiana, Massachusetts, Mississippi, Montana, New |
| repurchase his home for what is owed plus all the | | | | Hampshire, New York, Oklahoma, Pennsylvania, South |
| associated costs of the foreclosure. | | | | Carolina, and Texas. While these sates have no |
| Proof of funds can are either cash in the bank or a | | | | redemption privileges, it is possible to bring legal |
| pre-approved letter from another lender that is willing | | | | action against the bank with regard to deficiencies in |
| to fund his buying back his home. The new lender | | | | the proceeding and mortgage irregularities. |
| does not have to be a bank but can be a "hard | | | | States that have one year redemptive rights include: |
| money lender" who will charge the homeowner a | | | | Alabama, Idaho (either 6 or 12 months), Kansas, |
| much higher interest rate and closing points and will | | | | Kentucky, Maine, North Dakota (6 or 12 months), and |
| only carry the loan for usually one year. These hard | | | | Wisconsin (possibly to 12 months). |
| money lenders are called "predatory lenders" in the | | | | The other states vary greatly because of specific |
| industry because they are looking to loan amounts | | | | terms in the mortgage or deed of trust contracts |
| that can easily be gotten back if the property is | | | | but range from 10 days to 240 days. It is imperative |
| foreclosed on and sold at auction. | | | | that you consult with someone who is familiar with |
| The homeowner who lives in one of the states that | | | | your local foreclosure laws because they vary greatly |
| has long redemption periods, can solicit local hard | | | | from state to state, and the sale or auction practices |
| money lenders or real estate investors to exercise | | | | vary from county to county. |
| his redemptive right if there is equity in the home | | | | |