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SF2338 (Legislative Session 94 (2025-2026))

Mortgage foreclosure redemption and surpluses authorization

Related bill: HF1027

AI Generated Summary

This bill proposes amendments to various sections of Minnesota Statutes related to mortgage foreclosure, redemption, and surpluses from foreclosure sales. Key provisions include:

  1. Tax Payments as Liens: If a tenant, occupant, or other interested party pays delinquent property taxes that the owner should have paid, that payment can become a legal lien on the property once recorded with the county.

  2. Surplus Funds from Foreclosure Sales:

    • Any surplus funds of $100 or more after a foreclosure sale must be held by the sheriff for the duration of the redemption period.
    • The surplus can be applied toward redemption if requested by the property owner.
    • If there is no redemption, surplus funds are distributed first to junior creditors who file a claim within the redemption time frame, then to the owner of record, unless directed otherwise by court order.
    • The sheriff must notify the owner if there is a surplus of $100 or more.
    • If there are competing claims to the surplus, the sheriff may seek a court ruling on proper distribution.

  3. Full Satisfaction of Mortgage Debt: Proceeds from a foreclosure sale will fully satisfy the mortgage debt unless otherwise specified under another statute.

  4. Redemption by Creditors:

    • The redemption period for creditors is extended from 7 days to 14 days.
    • Creditors seeking to redeem must file specific documentation and notify relevant county offices.
    • If a dispute arises regarding redemption, the sheriff can request a court decision, staying further junior creditor redemptions until resolved.

The bill overall strengthens protections for homeowners, clarifies rules for surplus distributions, and modifies creditor redemption procedures in foreclosures.

Bill text versions

Actions

DateChamberWhereTypeNameCommittee Name
March 09, 2025HouseFloorActionIntroduction and first reading
March 09, 2025SenateFloorActionIntroduction and first reading
March 09, 2025HouseFloorActionReferred toJudiciary and Public Safety
March 09, 2025SenateFloorActionReferred toJudiciary and Public Safety
SenateNoteActionHF substituted in committee

Citations

 
[
  {
    "analysis": {
      "added": [
        "Clarification on how occupants and tenants may file notices of payment."
      ],
      "removed": [],
      "summary": "This bill amends the conditions under which taxes paid by tenants or occupants become a lien on the property under Minnesota Statutes section 272.45.",
      "modified": [
        "Interest rate at 12 percent for recoverable amounts."
      ]
    },
    "citation": "272.45",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [
        "Requirement that surplus of $100 or greater be held for the redemption period."
      ],
      "removed": [],
      "summary": "The bill updates the process for handling surplus from a foreclosure sale under Minnesota Statutes section 580.10.",
      "modified": [
        "Clarification on demand requirements for surplus disbursement."
      ]
    },
    "citation": "580.10",
    "subdivision": "subdivision 1"
  },
  {
    "analysis": {
      "added": [
        "Reference to section 582.30 for exceptions."
      ],
      "removed": [],
      "summary": "This section involves the procedure for the satisfaction of judgment mortgage under Minnesota Statutes section 580.225.",
      "modified": [
        "Clarification on satisfaction after foreclosure sale."
      ]
    },
    "citation": "580.225",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [
        "Allowance for 14-day redemption period."
      ],
      "removed": [],
      "summary": "Modifies redemption processes by creditors for foreclosed properties under Minnesota Statutes section 580.24.",
      "modified": [
        "Procedure for recording liens and notifying sheriffs adjusted."
      ]
    },
    "citation": "580.24",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Amendments related to redemption and foreclosed property proceedings under Minnesota Statutes section 582.03, subdivision 1.",
      "modified": [
        "Updates to how surplus and redemption rights are handled in foreclosure."
      ]
    },
    "citation": "582.03",
    "subdivision": "subdivision 1"
  }
]

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