This bill amends several sections of the Minnesota Statutes concerning mortgage foreclosure, redemption, and surplus funds. A significant change is the introduction of a "sworn statement" process for occupants or tenants who pay delinquent taxes on behalf of property owners, which will create a lien on the property from the date of recording. The bill also establishes new procedures for managing surplus funds from foreclosure sales, including requirements for notifying property owners about these funds and allowing them to request that the surplus be applied to their redemption amount. Additionally, the redemption rights of creditors are clarified, and the redemption period is extended from seven days to 14 days for certain creditors.

Further amendments specify that the amount received from a foreclosure sale satisfies the mortgage debt, except as outlined in specific sections, and introduce provisions for resolving competing claims to surplus funds. The bill details the documentation required for redemption and establishes a fee structure for sheriff's services related to redemption. It also clarifies allowable costs that can be claimed upon redemption of a sheriff's certificate of sale, including taxes, insurance, and reasonable attorney fees, with interest accruing from the date of payment. Importantly, the bill addresses dual tracking in foreclosure cases, ensuring that servicers do not refer a mortgage loan for foreclosure while a loss mitigation application is pending, thereby protecting mortgagors during the loss mitigation process. The effective date for many of these changes is set for redemptions occurring after January 1, 2026.

Statutes affected:
Introduction: 272.45, 580.10, 580.225, 580.24, 580.25, 580.26, 580.28, 582.03, 582.043
1st Engrossment: 272.45, 580.10, 580.225, 580.24, 580.25, 580.26, 580.28, 582.03, 582.043