Right Of Redemption?
Dave explains what to do if you want to purchase a foreclosure and what a right of redemption means.
QUESTION: A listener asks for the best way to find a foreclosure house? What does right of redemption mean?
ANSWER: You live in a state that has right of redemption. That means when a foreclosure occurs, the owner has a period of time in which they have the right to redeem the property. You don’t fully own the property in that time and they can buy the property back for what you paid for it within that time period.
For example, if it’s a 6-month right of redemption and you buy the property for $90,000 at the courthouse, the person who owned the property can pay you off with $90,000 plus some interest. Then they own the house again.
If you buy foreclosure property in a state that has right of redemption, then you need to sit on the property until that period is up.