1.1 A bill for an act
1.2 relating to real property; limiting due-on-sale clauses in certain instances; providing
1.3 a private right of action; amending Minnesota Statutes 2024, section 58.13, by
1.4 adding a subdivision.
1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.6 Section 1. Minnesota Statutes 2024, section 58.13, is amended by adding a subdivision
1.7to read:
1.8 Subd. 3.Due-on-sale clauses; limitation.(a) With respect to a loan secured by residential
1.9real estate, a lender is prohibited from exercising a due-on-sale clause with respect to the
1.10following:
1.11 (1) a transfer-on-death deed that conveys or assigns the deceased borrower's interest in
1.12the residential real estate to a grantee beneficiary;
1.13 (2) a transfer by devise, decent, or operation of law upon a joint tenant's death;
1.14 (3) a transfer by which the borrower's spouse or children become an owner of the
1.15residential real estate;
1.16 (4) a transfer resulting from a dissolution of marriage decree, legal separation agreement,
1.17or incidental property settlement agreement by which the borrower's spouse becomes an
1.18owner of the residential real estate; or
1.19 (5) a transfer into an inter vivos trust by which the borrower is and remains a beneficiary,
1.20and that does not relate to a transfer of occupancy rights in the residential real estate.
1.21 (b) Paragraph (a) does not apply to a reverse mortgage made under section 47.58.
1Section 1.
REVISOR RSI/KR 25-0229701/31/25
State of Minnesota
This Document can be made available
in alternative formats upon request
HOUSE OF REPRESENTATIVES
H. F. No. 1224
NINETY-FOURTH SESSION
Authored by Freiberg02/20/2025
The bill was read for the first time and referred to the Committee on Judiciary Finance and Civil Law 2.1 (c) Notwithstanding section 58.18, subdivision 4, a person aggrieved by a violation of
2.2this subdivision has a private right of action for equitable relief, reasonable attorney fees,
2.3and costs.
2Section 1.
REVISOR RSI/KR 25-0229701/31/25