Foreclosure GlossaryLegal term
What Is Mortgage Reinstatement?
Mortgage reinstatement means stopping a foreclosure by paying every past-due payment, fee and cost in one lump sum, so the loan returns to its normal schedule.
Reinstating undoes the lender’s acceleration clause, which had made the whole balance due. You owe only what you missed plus costs, not the full loan. It is the cheapest exit in the foreclosure glossary for owners who can raise the money.
On this page (5)
How Does Mortgage Reinstatement Work?
Mortgage reinstatement works by asking the servicer for a reinstatement quote, paying it in certified funds by the deadline, and getting written confirmation that the foreclosure is cancelled. The quote usually lists missed payments, late charges, inspection costs and trustee or attorney fees. In a trust deed state, the amount often appears first on the notice of default.
California caps the fees. Under California Civil Code § 2924c, trustee or attorney fees in a reinstatement are limited by a schedule tied to the unpaid principal, starting with a $350 base on loans of $50,000 or less.
FHA loans add a federal rule. Under section III.A.2.o of the HUD Handbook 4000.1, the servicer must accept a lump-sum reinstatement including foreclosure costs. The main exceptions are a reinstatement already accepted in a foreclosure within the previous 2 years and cases where reinstating would hurt the lien’s priority.
Mortgage Reinstatement Rules by State
Reinstatement rules differ by state mainly in how long the right lasts, from 90 days after a lawsuit is served to the day before the sale. Arizona’s deadline is in A.R.S. § 33-813.
| State | Rule | Statute |
|---|---|---|
| California | Owner can reinstate from the notice of default until 5 business days before the sale date, and the right revives if the sale is postponed | Cal. Civ. Code § 2924c(a)(1), (e) |
| Arizona | Owner can reinstate until 5 p.m. on the last day other than a Saturday or holiday before the sale, and the trust deed stays in force as if no default occurred | A.R.S. § 33-813(A), (B) |
| Illinois | Owner can reinstate within 90 days after being served in the foreclosure suit. A court can block a second use within 5 years | 735 ILCS 5/15-1602 |
Illinois sets the shortest window, so an owner served in a lawsuit there should get a quote right away, using the steps in 735 ILCS 5/15-1602 and the Illinois foreclosure process.
Example
The following is a fictional example. Nora, in Phoenix, falls 5 months behind. Her notice of trustee sale sets a Thursday auction. On Monday she gets a quote of $9,850 for missed payments, late charges and trustee fees, wires it Tuesday, and the trustee cancels the sale.
FAQ
What Is Included in a Reinstatement Amount?
A reinstatement amount covers all missed payments plus late charges, foreclosure costs and allowed trustee or attorney fees, but not the accelerated principal that would not otherwise be due.
Is Reinstatement the Same as Redemption?
No, reinstatement means paying only what is past due so the loan continues, while redemption means paying off the whole debt or, after some sales, the sale price.
Sources
- California Civil Code § 2924c (2025). Justia. https://law.justia.com/codes/california/code-civ/division-3/part-4/title-14/chapter-2/article-1/section-2924c/
- Arizona Revised Statutes § 33-813. Arizona State Legislature. https://www.azleg.gov/ars/33/00813.htm
- 735 ILCS 5/15-1602. RulesOfCivilProcedure.com. https://rulesofcivilprocedure.com/il/section-15-1602/
- HUD Handbook 4000.1, Update 18. U.S. Department of Housing and Urban Development. August 12, 2026. https://www.hud.gov/sites/default/files/Housing/documents/40001-hsgh-Update-18.pdf
This page explains the general process and is not legal advice. Rules change and courts interpret them, so confirm with a real-estate attorney in your state before acting.