Definitions
Cure means paying past-due amounts to restore the loan to current status. Reinstatement is essentially the same as cure. Redemption means paying the entire remaining balance. The cost difference is significant.
When Reinstatement Is Available
For mortgages, many states provide a statutory right to reinstate before foreclosure sale. For auto loans, reinstatement is less common by statute. In bankruptcy, Chapter 13 provides a right to cure that overrides state law.
Strategic Considerations
If you can afford to cure/reinstate, do it -- you keep the property on original terms. If not, Chapter 13 spreads the cure over 3-5 years. If you cannot cure at all, consider surrender plus bankruptcy to discharge any deficiency.
Frequently Asked Questions
Is reinstatement the same as cure?
In most contexts, yes. Both refer to paying past-due amounts to restore current status.
Can I reinstate after the foreclosure sale?
In some states, yes. Some provide a post-sale redemption period (6-12 months). Check your state's foreclosure laws.
What if I can afford to cure but not redeem?
If your state provides a right to reinstate, use it. If the lender demands full balance, Chapter 13 de-accelerates the loan.
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