Minnesota is well known for its farms and winter sports. Located in the northern part of the United States, it butts against Canada and has a great deal of cold, winter weather. In these economic times Minnesota Foreclosures have been profound and many good bargains can be found.
It was one of the first in the nation to enact a Homeowner-Lender Mediation Act which requires the participation of lenders and owners prior to foreclosure. Passed in 1986 it was intended to keep farmers from losing their property. A check of 2009 figures shows that mediation were up 86 percent over that year. Under this act the owner must undergo financial counseling prior to mediation.
One of the laws in the state allows the person who can no longer make payment on the house to offer the deed to the lender. This allows the owner to retain a good credit record. However, there is a clause that many do not read that the owner is still responsible to pay the rest of the money due on the contract. This, in many cases, results in the owner having to file for bankruptcy which ruins their credit anyway.
Lenders, in general, simply shudder at the thought of assuming more foreclosure homes. Handling a foreclosure home is very expensive and involves a lot of legal and paper work. Many of the homes are in disrepair and needs extensive work. Most of these homes are sold “as-is” but the buyer should be wary of this type of sale.
Before purchasing a foreclosed home in Minnesota or elsewhere one should carefully research county records, state foreclosure laws, value of neighborhood homes and anything else pertinent. In some states a new owner finds that there is a lien on the property and they are responsible not only for the purchase price but for what the previous owner owed as well.
Minnesota has a provision where a prospective purchaser can request a Truth in Housing Inspection Report in certain counties. This is a must in purchasing a foreclosure that may have hidden heating, plumbing, structural defects or other problems. With this statement in hand negotiations can then be made with the lender to adjust the price.
It is always a good idea to ask for a Transfer Disclosure Statement. In this case the seller must fill out a form which lists any known defects in the building. This is very helpful, especially if the property is rodent infected, had water leaks within the walls, etc. Even with this report there can be damages that are cosmetically covered or repairs have been made by an unlicensed person. Minnesota Foreclosures, like others, needs to be carefully examined before making any purchase.
Knowing your real estate agent is vital when purchasing a Minnesota Foreclosures property. A good agent is well aware of state laws regarding these transactions and can guide one through to a satisfactory purchase. Currently there are scammers sending listings through the mail that look very official. They list foreclosures at a very low price. Unfortunately, these homes are not for sale and anyone making a deposit loses their money with no hope of getting it back.
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