How foreclosure works in Minnesota, step by step

1. Missed payments and the 120-day window

Under federal rules, a servicer generally can’t make the first foreclosure filing until you’re more than 120 days behind (12 CFR 1024.41(f)). Use this time: apply for help, talk to a free advisor (866-462-6466), or get your home’s value so you know whether selling is an option.

2. The counseling notice

Before the foreclosure is recorded, the lender must tell you in writing that free foreclosure prevention counseling is available, and send your name and contact information to an approved counseling agency (Minn. Stat. 580.021).

3. Notice of sale: six weeks in the newspaper, served on you

The notice of the sheriff’s sale is published for six weeks in a legal newspaper and served on the people living in the home at least four weeks before the sale (Minn. Stat. 580.03). It lists the amount claimed, the sale date and place, the redemption period, and, for an owner-occupied single-family home, the date you must move out if you don’t reinstate or redeem (Minn. Stat. 580.04).

4. Before the sale: reinstate or postpone

• Reinstate: paying what’s past due plus allowed costs any time before the sale stops the foreclosure (Minn. Stat. 580.30).
• Postpone: the owner of a one-to-four-unit homestead can postpone the sale once, by about five months, by recording a sworn affidavit at least 15 days before the sale. The trade-off: the redemption period after the postponed sale drops to five weeks (Minn. Stat. 580.07, subd. 2). It buys time before the sale, not after it.

5. The sheriff’s sale

The county sheriff auctions the home at the date and place in the notice. The lender usually bids first; the winning bidder gets a sheriff’s certificate of sale, not the keys (Hennepin County Sheriff). You still own and live in the home during the redemption period.

6. The redemption period

After the sale, you can redeem (pay the sale amount plus interest and allowed costs) or sell the home and pay off the certificate at closing. The usual period is:

• Six months for most homes (Minn. Stat. 580.23, subd. 1).
• Twelve months in some cases, for example when the amount claimed is less than two-thirds of the original loan amount, or for larger acreage (580.23, subd. 2).
• Five weeks if the sale was postponed by the owner (580.07) or a court finds the home abandoned (Minn. Stat. 582.032).

Your notice and the sheriff’s certificate state your exact period. If the home has equity, selling during redemption can let you keep that equity instead of losing it.

7. When redemption ends

If you don’t redeem, the buyer at the sheriff’s sale owns the home when the period ends, and you have to be out by 11:59 p.m. on the date in your notice (Minn. Stat. 580.04). Tenants with a lease get at least 90 days’ written notice after redemption ends, and a bona fide lease can run longer in some cases (Minn. Stat. 504B.285, subd. 1a).

8. Will I owe the rest?

For a foreclosure by advertisement with a six-month or five-week redemption period, Minnesota doesn’t allow a deficiency judgment for the shortfall (Minn. Stat. 582.30, subd. 2). Other cases (foreclosure through a court case, 12-month redemption, second mortgages or home equity lines) can be different: ask an attorney. Forgiven debt can also have tax consequences; see taxes on forgiven debt.

This is general information about Minnesota law, not legal advice. Your notices, your loan and your lender’s rules decide the details; an attorney or a free foreclosure prevention advisor can look at your papers.