I have owned a home in Arizona since 2005. The home has been in my family for many years. A year ago my company downsized and my job was cut. I couldn't keep up with the mortgage payments and recently lost the house in foreclosure. Because the home has been in the family for so long, however, some relatives have come up with cash to try to get the house back. I've heard that I might be able to "redeem" the home by buying it back. Is there any way I can get the family home back?
You may be able to get your home back after the foreclosure sale, but it’s very unlikely. In Arizona, you can repurchase or “redeem” your home after losing it in foreclosure, but only if the foreclosure is judicial (where the lender files a lawsuit in court to foreclose your home). However, the vast majority of residential foreclosures in Arizona are nonjudicial (where the foreclosure takes place without court supervision). (To learn more about foreclosure laws and procedures in Arizona, visit Nolo’s Arizona Foreclosure Law Center.)
What this means for you is that if your foreclosure is the same as most Arizona foreclosures, you won’t be able to redeem the home afterwards.
Arizona Redemption Rules in a Nutshell
In a nutshell, here are the rules:
- Judicial foreclosure. If the foreclosure was judicial you can redeem your home within six months of the foreclosure sale (or within 30 days, under certain circumstances). This is explained in more detail below.
- Nonjudicial foreclosure. If the foreclosure was nonjudicial, you do not have the chance to get the home back this way. (Ariz. Rev. Stat. Ann. § 33-811(E)).
Redeeming Your Home After a Judicial Foreclosure in Arizona
If the foreclosure is judicial, can redeem your home within:
- six-months after the sale date, or
- 30 days after the sale date, if the court determines the property was abandoned and was not used primarily for grazing or agricultural purposes (Ariz. Rev. Stat. Ann. § 12-1282).
If you don’t redeem the home within this time frame (called the redemption period), your right to redeem expires. After that, you won’t have another opportunity to get your house back. (Learn more general information about the right of redemption.)
How to Redeem Your Home
In order to redeem, you must reimburse the purchaser (the person or entity who bought it at the foreclosure sale) for the full price paid at the sale plus 8%, along with the cost of any assessments or taxes that the purchaser paid after the sale, and interest on that amount (Ariz. Rev. Stat. Ann. § 12-1285).
To find out the specific procedures for redeeming your home after a judicial foreclosure, check with the court or consult with an Arizona attorney.
If Possible, Don’t Wait Until After the Foreclosure to Save Your Home
In most cases if you want to keep your home, it is better to take action before the foreclosure sale. This will give you more options to save the property. It sounds like it's too late for you to save your home. But in the future, if you face this issue again, you could:
- pay off the past-due amounts to reinstate (catch up on) the loan, or
- try to work out an alternative to foreclosure that will allow you to keep the property, such as a mortgage modification, forbearance agreement, or repayment plan.
It takes a few months for the lender to complete a nonjudicial foreclosure (even longer for a judicial one) which gives homeowners enough time to explore alternatives to foreclosure before the sale.
Finding Arizona’s Redemption Laws
To find the statutes that discuss your right to redeem the home after a judicial foreclosure in Arizona, go to Title 12, Chapter 8, Article 11 of the Arizona Revised Statutes.