What is a reinstatement clause?

Reinstatement clause is a clause in a foreclosure law that gives homeowners in the state of Florida the right to stop a foreclosure by paying the money owed to the lender. The clause allows homeowners to bring the loan current by paying off the arrearage, or any unpaid balance, by a set date. This clause is a way for homeowners to avoid foreclosure and keep their home. Generally, homeowners must provide written notice to the lender and the foreclosure must be stayed for up to 60 days. During this time, the homeowner will be responsible for paying the arrearage as well as all other associated fees and expenses. Once the homeowner is able to pay the past due amount in full, the foreclosure will be cancelled and the homeowner will keep ownership of their home. Without a reinstatement clause, lenders would be allowed to move forward with the foreclosure immediately after defaulting on the loan. This clause allows the homeowner the grace period they need to pay off their loan, protecting them from the loss of their home. The addition of a reinstatement clause to the foreclosure law in the state of Florida has helped keep many people in their homes.

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