Right of Redemption

States With Right of Redemption

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The right of redemption can cause a real estate investor to have to give back the property they win at a foreclosure auction to the original homeowner. Which are the states with right of redemption? Read on find out…

What is the Right of Redemption?

The right of redemption gives a homeowner that is in foreclosure the right to “redeem” the mortgage and get his or her property back.

To redeem the mortgage the homeowner must pay a distinct sum of money during a select time period.

There may be two different rights of redemption depending on the state the homeowners are in. These are the:

  • Pre-foreclosure equitable right of redemption
  • Post-foreclosure statutory right of redemption

The Pre-Foreclosure Equitable Right of Redemption

All states allow homeowners to save their homes and mortgages from foreclosure prior to the foreclosure sale. This can be done by paying off the full remaining mortgage balance and any additional fees and costs before the foreclosure sale. Paying the balance to redeem can be accomplished by refinancing the mortgage or finding another buyer of the home if the homeowner cannot come up with the cash for a lump sum payment.

The Post-Foreclosure Statutory Right of Redemption

About half of all states have laws that give homeowners the right to redeem their mortgages for a period of time after the foreclosure sale. Redemption is typically done by paying the foreclosure sale price, plus interest and other fees, to the winning foreclosure sale buyer.

If a home sells at a foreclosure auction for a price far below its fair market value, the homeowner may be able to recoup the equity by redeeming the property for the foreclosure sale price, selling the home to a buyer for the fair market value, and keeping the difference.

State Laws Regarding the Right of Redemption

Each state has its own laws governing a homeowner’s right of redemption. Find your state in the list below to find out whether you have the right to redeem your mortgage after the foreclosure sale and what restrictions may apply.

States With the Right of Redemption

  • Alabama, within 1 year after foreclosure sale.
  • Alaska, within 1 year after a judicial foreclosure sale.
  • Arizona, within 6 months after a judicial foreclosure sale.
  • Arkansas, within 1 year after a judicial foreclosure sale.
  • California, within 1 year after a judicial foreclosure sale.
  • Florida, depending on the date.
  • Idaho, within 6 months and 20 acres or less, or 1 year if greater than 20 acres, and if after a judicial foreclosure sale.
  • Illinois, within 7 months after a foreclosure complaint or 3 months after final foreclosure judgement. Other restrictions apply.
  • Indiana, After a foreclosure judgement, not after foreclosure sale.
  • Iowa, within 1 year after a judicial foreclosure, or six months after sale.
  • Kansas, within 1 year after a judicial foreclosure sale. Exceptions included.
  • Kentucky, within 1 year after a judicial foreclosure sale if foreclosure sale price is lower than 2/3 of the property’s market value.
  • Maine, either 90 days or within a year for a judicial foreclosure. Check exceptions.
  • Massachusetts, within three years after a judicial foreclosure sale. Within 1 year with exceptions.
  • Michigan, one, three, six months, and within 1 year of a non judicial foreclosure, with exceptions.
  • Minnesota, within six months or one year of a nonjudicial foreclosure, with exceptions.
  • Missouri, within 1 year after a nonjudicial foreclosure sale, with exceptions.
  • Montana, within 1 year after a judicial foreclosure sale.
  • Nebraska, until court confirms the sale in a judicial foreclosure.
  • Nevada, within 1 year in a judicial foreclosure.
  • New Jersey, with exceptions.
  • New Mexico, within 9 months of a judicial foreclosure, with exceptions.
  • North Carolina, within ten-day “upset bid” after a non judicial foreclosure sale, with exceptions.
  • North Dakota, within 60 days after a judicial foreclosure sale.
  • Ohio, until confirmation of the judicial foreclosure sale by a court.
  • Oklahoma, up until the the completion of the sale, with exceptions.
  • Oregon, within 180 days for a judicial foreclosure.
  • Rhode Island, three years for a judicial foreclosure.
  • South Carolina, only “upset bid” after a judicial foreclosure sale.
  • South Dakota, 1 year or 180 days after a judicial foreclosure, with exceptions.
  • Tennessee, within 2 years after a non judicial foreclosure.
  • Utah, within 180 days after a judicial foreclosure sale.
  • Vermont, within six months after a judicial decree of strict foreclosure, with exceptions.
  • Washington, within 8 months or 1 year after a judicial foreclosure sale, with exceptions.
  • Wisconsin, after foreclosure judgement and before a judicial foreclosure sale, with exceptions.
  • Wyoming, within 3 months of a nonjudicial foreclosure sale.

States Without the Right of Redemption

  • Colorado
  • Connecticut
  • Delaware
  • Georgia
  • Hawaii
  • Louisiana
  • Maryland
  • Mississippi
  • New Hampshire
  • New York
  • Pennsylvania
  • Texas
  • Virginia
  • West Virginia

States With the Right of Redemption in a Nutshell

In this post we’ve discussed how the right of redemption works, states with right of redemption, and states that do not have it. Not all states allow the right of redemption, and the ones that do have specific requirements and time frames. Check your state’s real estate laws to find out exactly what is allowed along with any stipulations.

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