Postponing A Sheriff Sale
In Minnesota, a homeowner can postpone a sheriff sale if they meet several criteria. In some cases; but not all, this tactic can help a homeowner who is in financial distress. First, if thinking of attempting a short sale and there is any possibility at all of leaving the property before a resolution has been reached, you may want to postpone. This is due in part, because after a sheriff sale occurs; if the property is abandoned during the redemption period, some lenders will seek to have your redemption period shortened to 5 weeks instead of 6 months had you remained in the home. When your redemption period is over, the property reverts to the foreclosing party. Obviously this could have negative consequences on any incomplete short sale negotiations. Also, if you move out of the home, it may have a negative affect on the taxability of any forgiven debt.
Secondly, once the sheriff sale occurs, you lose the ability to reinstate your mortgage. After the sheriff sale, the only way to stop the foreclosure from running its course, is to payoff the mortgage in full or complete a successful short sale. If you believe you can get your mortgage reinstated, postponing the sheriff sale will give you extra time to work this out!
YES, a short sale can still be executed AFTER the the sheriff sale has occurred.
Caveat: If you do postpone the sheriff sale, your redemption period will be shortened to 5 weeks from the date the sale ultimately takes place.
Your options and the ultimate strategy you pursue can be confusing. This blog is not a substitute for professional legal advice.
Don Mailey
RE/MAX Results
952-212-0968
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