Expired Redemption Period: Now What?

In Wisconsin, foreclosure law provides a redemption period. This is the period after judgment and is meant as a time where the mortgagor can payoff the full amount of the judgment [1]. The length of the redemption period depends on the type of the property and whether the lender waived deficiency. For instance, a residential property where the lender waives deficiency would have a redemption period of 4 months [2]. Contrast this with abandoned property which has a 6-week redemption [3]. There are other redemption periods made for commercial property [4].  

Whatever the case, what happens when the redemption period expires? Can the owners still sell their property? The good news is that the lender still must sell the property and confirm the sheriff’s sale. If the lender didn’t time the expiration of the redemption period with the sale date, it is their responsibility and in Wisconsin, the owner has until the confirmation of sale to redeem [5]. That is, even though the redemption period granted by the Judgment has expired, the owner may still redeem their property.

If you encounter someone who is in foreclosure and the sale hasn’t taken place, but the redemption period technically expired, you should be fine setting a closing but be mindful of when the sale is set and the confirmation hearing date. Make sure the payoff includes all attorney fees and costs.

If you are unsure as to timing or have a general foreclosure question, give your First American underwriter a call for guidance.

Written by Steve Zablocki, Underwriting Counsel

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[1] M&I Marshall & Ilsley v. Kazim Investment, Inc. 2004 WI App 13, 269 Wis. 2d 479, 678 N.W.2d 479, 03-0404.

[2] Wis. Stat. §846.101(2)(b)

[3] Wis. Stat. §846.102

[4] Wis. Stat. §846.103

[5] State Bank v. Sechen, 2005 WI App 253, 288 Wis. 2d 168, 707 N.W.2d 576, 05-0482.