Michigan Foreclosure Law
- Judicial Foreclosure Available: Yes
- Non-Judicial Foreclosure Available: Yes
- Primary Security Instruments: Deed of Trust, Mortgage
- Timeline: Usually 60 days
- Right of Redemption1: Yes
- Deficiency Judgments2 Allowed: Varies, depending on procedure used
Lenders in the state of Michigan may foreclose on a deed of trust or mortgage in default using either a judicial or non-judicial foreclosure process.
Judicial Foreclosure
A judicial process of foreclosure requires that the lender file a lawsuit and attain a court order to foreclose on a particular property.
Judicial Foreclosure Procedure
In Michigan, the court may order the property sold six (6) months after the initial filing of the lawsuit. The circuit court commissioner or other court appointed party conducts the sale of the property. The borrower has six (6) months to redeem the property after the sale.
Non-Judicial Foreclosure
If a power of sale clause exists in the deed of trust or mortgage document, a non-judicial process of foreclosure is used. This allows the lender to sell the property and pay off the balance of the loan in the event the homeowner defaults. The power to sell may be completed by the lender or their representative in situations where a power of sale exists. The procedure for this type of foreclosure process is explained in the "Power of Sale Foreclosure Procedure" listed below.
Non-Judicial Foreclosure Procedure
Michigan uses a method called Foreclosure by Advertisement. With this, a notice of sale is published once a week for four (4) consecutive weeks in a newspaper in the county where the property is located. A copy of the foreclosure notice must also be posted in a noticeable place on the property within fifteen (15) days after the first publication. The lender or their representatives has a right to enter the mortgaged premises to post or deliver foreclosure notices.
The sale is by public auction held at the court house or place where the circuit court for the county handles lawsuits, and is conducted between 9:00 a.m. and 4:00 p.m. The sale can be postponed from time to time provided notice is given at the original location of the sale regarding the new day and time.
Sale is to the highest bidder who will receive a deed which specifies the last date by which the borrower can redeem the property. The deed must be recorded within twenty (20) days after the sale. The deed and the foreclosure do not wipe out liens or claims that existed prior to the date of the original mortgage.
1 A borrower’s right to reacquire property lost due to a foreclosure.
2 A personal judgment against the borrower for the remaining balance on the loan after a foreclosure sale.
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