A rural property in Crow Wing County, Minnesota was sold at a non-judicial foreclosure sale under Minn. Stat. Ch. 580. The borrower, Agnes, had paid only 25% of the original loan balance before defaulting. A junior lienholder, First Credit Union, also holds a recorded judgment lien on the property. The foreclosure sale occurred on June 1. Agnes wants to know her redemption rights. Which of the following correctly describes the redemption situation?

Correct Answer

B) Agnes has 12 months to redeem from June 1; First Credit Union may redeem after Agnes's redemption period expires

Under Minn. Stat. Ch. 580, when less than one-third of the original debt has been paid (Agnes paid only 25%), the mortgagor's statutory redemption period is extended to 12 months from the date of the foreclosure sale. Additionally, under Minnesota law, junior lienholders such as First Credit Union have their own redemption rights, but these rights are exercised in sequence after the mortgagor's redemption period. Junior lienholders redeem in order of their lien priority after the mortgagor's period expires, not concurrently with it.