The State of Minnesota amended Minnesota foreclosures regulations on the fifteenth of June, 2009. The purpose of these changes is twofold. First, it is hoped that the new laws will reduce the number of personal bankruptcies resulting from the recession. Second, it is hoped that the new laws will reduce the property value damage done to a neighborhood when a property in the neighborhood is abandoned.

Under the new Minnesota foreclosures laws, homeowners who are in arrears on their property and have been given a forced sale date can apply to have the sale date postponed by five months. Before these changes were made the only party with the authority to postpone a forced sale was the mortgage holder. Lawmakers hope that homeowners who have fallen into arrears after losing their jobs in these days of uncharacteristically high unemployment can use the additional time to get back to work and bring their mortgage payments current.

Postponing the sale date is only a viable solution if a homeowner has a reasonable belief that they can increase their income, i. E., find employment, and catch up on what is owed. The alternative is to allow the sale and either come up with the balance due on the post-sale mortgage amount within six months or be forced into bankruptcy. Given the recession, the later is more likely than the former.

The criteria to qualify for and secure a forced sale date postponement are relatively easy to meet. The option is only applicable to homestead residences. Under law, only one homestead residence is permitted per resident. The homestead property can have from one to four units and must be the owners primary residence.

In order to postpone a forced sale, the home owner must fill out an official Affidavit of Postponement. Within 15 days of the date of sale, the homeowner must file or provide copies of the affidavit to three different parties; the county office of the county in which the property lies, the office of the sheriff charged with conducting the sale, and the mortgage holders real estate attorney.

The redemption period refers to the six months following the forced sale of a mortgaged home. By the end of the redemption period the mortgage, less the proceeds of the forced sale, must be paid in full or the mortgage holder may force the mortgagee into bankruptcy. For homeowners considering taking advantage of the 5 month postponement option, it is essential that they get the mortgage current within the postponement period.

Homeowners who avail themselves of the postponement option have the redemption time allotment reduced to 5 weeks from the usual 6 months. This was required by the mortgage holders (that is to say, the banks and brokers). Homeowners who fail to bring their mortgage up to date within the 5 month postponement period will have their homes sold and must pay the remaining balance within 5 weeks of the sale or face personal bankruptcy.

There are no second chances when it comes to Minnesota foreclosures laws. One per customer. This is as true for those who successfully get their mortgage current within the 5 month period as it is for those who fail to do so. Even if a homeowner uses a postponement to get back on their feet and up to date with their payments, and even if they keep those payments current for years, they can never ask for a postponement of a forced sale again.

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