Real Estate foreclosures in the State of Michigan are largely non-judicial and handled primarily out-of-court. The foreclosure process generally takes 3-14 months and this period depends on the permitted redemption period. A typical foreclosure would take about eight months.
Foreclosure in the State of Michigan can also be judicial and can be processed through the Court. However, most of the mortgages contain the power-of-sale clause empowering the lender to dispose off the property in a sale, out-of-court, to recover the due of debts if the borrower defaults.
It is not mandatory by Michigan law for the lender to issue a notice of default to the borrower before initiating the foreclosure procedure. However, there may be such a stipulation to issue a notice of default in the mortgage. Whether or not the borrower has the right to halt the foreclosure process, by paying off the amount in default, is defined in the mortgage.
Generally the foreclosure sale is scheduled in about two months after the process is initiated by the lender. A notice of sale is required to be published in a local newspaper, once a week, for a period of four consecutive weeks. The sale shall not be scheduled within a period of 28 days from the date of publication of the first notice in the newspaper.
The notice of sale must contain the following details;
Within a period of 15 days from the date of the first publication of the notice in the newspaper, a true copy of the notice shall be posted in a conspicuous place in the property.
Usually, the foreclosure sale is conducted as a public auction at the County Courthouse between the hours of 9:00 a.m. and 4:00 p.m. by a trustee or the Sheriff. A postponement of the sale is permitted by posting a notice of adjournment at the time and location of the sale.
Any member of the public, including the lender, may tender a bid for the property at the time of the sale. The property is sold to the highest bidder. The person conducting the sale, that is the Sheriff or the trustee, shall complete the necessary documents for transfer of ownership rights to the winning bidder of the sale. The transfer documents shall also contain the period of expiry of redemption.
The deed of transfer of ownership shall be completed within 20 days from the date of the sale. Any delay in this process shall not invalidate the sale, but the period of redemption shall not commence unless the deed is completed and signed by the Sheriff. The period of redemption varies and shall be mentioned in the notice of sale. Typically the redemption period runs six months. During the redemption period, the borrower has the option of redeeming the property by remitting the winning bid along with all applicable costs.
If you need more information about Michigan foreclosure laws, you should contact a foreclosure lawyer, or contact us so we can recommend one for you.
