In Minnesota, lenders have two options to foreclose on a property in default: judicial foreclosure which involves a court order, or non-judicial foreclosure using a power of sale clause. For non-judicial foreclosure, the lender must provide at least 8 weeks notice before foreclosing on a homestead property. The foreclosure sale is then conducted by the county sheriff, who reads an itemized statement of the amount owed. The property is auctioned to the highest bidder, who receives a certificate of sale, and the borrower has one year to redeem the property by paying the past due amount. Lenders can also pursue borrowers for any remaining deficiency between the loan amount and property sale price

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Minnesota Foreclosure Law Summary
WHAT IS A SHORT SALE
Quick Facts
WHY USE SHORT SALE US
- Judicial Foreclosure Available: Yes
SUCCESS STORIES
- Non-Judicial Foreclosure Available: Yes
WHO QUALIFIES FOR A SHORT SALE
- Primary Security Instruments: Deed of Trust, Mortgage
FAQs
- Timeline: Typically 60 days
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- Right of Redemption: Yes
VALUE YOUR HOME
- Deficiency Judgments Allowed: Yes
STATE FORCLOSURE LAWS
In Minnesota, lenders may foreclose on deeds of trusts or mortgages in
CONTACT US default using either a judicial or non-judicial foreclosure process.
HIRE US Judicial Foreclosure
The judicial process of foreclosure, which involves filing a lawsuit to obtain a
court order to foreclose, is used when no power of sale is present in the
mortgage or deed of trust. Generally, after the court declares a foreclosure,
your home will be auctioned off to the highest bidder.
Non-Judicial Foreclosure
The non-judicial process of foreclosure is used when a power of sale clause
exists in a mortgage or deed of trust. A "power of sale" clause is the clause in
a deed of trust or mortgage, in which the borrower pre-authorizes the sale of
property to pay off the balance on a loan in the event of the their default. In
deeds of trust or mortgages where a power of sale exists, the power given to
the lender to sell the property may be executed by the lender or their
representative, typically referred to as the trustee. Regulations for this type of
foreclosure process are outlined below in the "Power of Sale Foreclosure
Guidelines".
Power of Sale Foreclosure Guidelines
If the deed of trust or mortgage contains a power of sale clause and specifies
the time, place and terms of sale, then the specified procedure must be
followed. However, in Minnesota, a non-judicial foreclosure may only occur if:
1) no lawsuit to collect the on the mortgage is already underway; 2) the
mortgage and any assignments of the mortgage to new lenders have been
recorded; and 3) a notice has been given eight (8) weeks before the
foreclosure on a homestead.
If all of these conditions have been met, then the foreclosure may proceed as
follows:

2. A notice of sale, containing the borrower and lender(s) name, the original loan
amount and current amount of default, the date of the mortgage, a description
of the property and the time, place and date of the foreclosure sale, must be
recorded in the county where the property resides.
The sheriff of the county in which the property is located must conduct the
sale on the date specified in the notice of sale. At some point during the sale,
the sheriff must read an itemized statement, which has been filed by the
lender, of the amount due at the time of the sale. The property is sold to the
highest bidder, who will receive certificate of sale.
Lenders may pursue a deficiency judgment, but it is limited to the amount of
the fair marker value of the property and the unpaid balance of the original
loan. Borrowers have up to one (1) year to redeem the property by paying the
past due amount on the loan.
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