Reinstatement

In depth

Reinstatement requires the borrower to pay all missed payments, late fees, attorney costs, and other default-related charges. Once reinstated, the loan continues on its original terms. Misconception: reinstatement is not the same as redemption; reinstatement avoids foreclosure by curing the default before sale, while redemption pays off the entire loan balance. Practically, state laws define reinstatement windows, often closing a few business days before the foreclosure sale. After acceleration is declared, some states still allow reinstatement, while others require redemption. In seller-financed deals, sellers should accept tendered reinstatement payments to avoid wrongful foreclosure claims and document acceptance carefully. Borrowers should always pursue reinstatement when financially possible, as it is far cheaper than refinancing or losing the property.