What are the rights of property owners in Iowa during a foreclosure sale?

Because so much land in Iowa is farmland, the foreclosure process is significantly different as it pertains to these types of property. Iowa farmland property owners who are faced with a foreclosure sale have several rights that might not be granted for non-agricultural properties including:

Right to redeem homestead

Section 654.16 of the Iowa code specifically allows a homeowner to request the court allow them to redeem a portion of their property under homestead. While there is a limit on the amount of land that may be included, the home would be included. The property owner would then be required to obtain an appraisal for this amount and would be able to purchase that piece of property back during a foreclosure sale.

Right to bid on property

Iowa code allows for the property owner who is dealing with a foreclosure sale to bid on their own property.  The lender in this instance cannot prevent this from occurring. It is important to note however that unless a specific agreement is reached with the lender prior to the sale that the property must sell for at least the amount owed or the homeowner may be facing a deficiency judgment. Another critical factor is that if there is another purchase mortgage (besides the one being foreclosed on) that these loans will not be discharged at a foreclosure sale if the property owner were to win the auction.

Contact a qualified legal team

Property owners in Iowa have several rights including mediation, right to cure a default as well as the right to request a delay of sale.  It is important that if you are facing possible foreclosure in Iowa that you contact an attorney who is well versed in the property laws that govern foreclosure.