redemption

Definition from Nolo’s Plain-English Law Dictionary

1) In Chapter 7 bankruptcy, when the debtor obtains legal title to collateral for a debt by paying the creditor the replacement value of the collateral in a lump sum. For example, a debtor may redeem a car note by paying the lender the amount a retail vendor would charge for the car, considering its age and condition. 2) In foreclosure, the homeowner's right (usually granted by state statute), for a certain period of time, to redeem the mortgage and keep the house by refinancing and paying off the original mortgage.

Definition provided by Nolo’s Plain-English Law Dictionary.