Foreclosure Redemption Period in Light of New Bill

In response to the Covid-19 pandemic, the Minnesota legislature passed a bill, HF4556/SF 4462, in April 2020 that was signed by Governor Tim Walz the following day. The bill extends numerous deadlines that would otherwise apply, but for the pandemic, such as the following language found in Article I, Section 16:

“The running of deadlines imposed by statutes governing proceedings in the district and appellate courts, including any statutes of limitations or other time periods prescribed by statute, is suspended during the peacetime emergency declared on March 13, 2020, in governor’s Executive Order 20-01 and any extensions authorized under Minnesota Statutes, section 12.31, subdivision 2, and for 60 days after the end of the peacetime emergency declaration.”

The peacetime emergency has been extended through November 12, 2020, by Executive Order 20-92. There was, however, confusion over what deadlines the bill covered and in particular whether or not the bill extended the time period in which a homeowner could redeem property after a mortgage foreclosure.

Our firm represented a lender who foreclosed a mortgage, and after the homeowner’s six-month redemption period expired, the homeowner argued the redemption period was extended based on the bill.

Whether or not the redemption period was extended pursuant to HF4556/SF4462, it was litigated in Ramsey County district court. The court held that the bill did not extend the deadline to redeem from a mortgage foreclosure and that the statutory six-month period still applies.

The court found that the bill is inapplicable to a foreclosure by advertisement as that is a non-judicial proceeding and the bill only relates to those matters that are in district or appellate court.

If you are looking for advice on the rights of a lender to a property where the mortgage is in default given the Covid-19 pandemic, Bernick Lifson has the practical experience to advise you on the law, as well as what various courts have ruled on the issue.

Find more information about the Executive Orders issued by Governor Walz since the declaration of the peacetime emergency.

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