The state of Michigan allows for foreclosures to be handled out of court, with a process that typically takes anywhere from three to fourteen months. Because a foreclosure on a home typically takes sixty days uncontested, there is a probability that once a borrower defaults on a loan and receives a foreclosure notice, he or she may either contest the foreclosure action of file for bankruptcy prior to the foreclosure proceedings reaching the auction point. Nonetheless, on average foreclosure proceedings in the state of Michigan will take approximately eight months to complete.
The Foreclosure Process in Michigan
Michigan is what is known as a non-judicial foreclosure because the foreclosure does not need to involve any court action. Foreclosure is instituted by foreclosure is done is by foreclosure notice. Also known as a foreclosure by advertisement, this notice speaks for itself.
Typically in a non-judicial foreclosure in the state of Michigan, there something called power of sale language that is used throughout the entire process. When a mortgage is signed or agreed upon at the sale of the home:
- A provision entitling an attorney to satisfy any defaulted loans should the home go into foreclosure is signed. This provision is called the power of sale clause.
- Once a home in the state of Michigan goes into foreclosure, then the power of sale clause kicks in automatically, and the attorney puts the home up for sale at an auction.
- Since there is no court-involvement on any level of a non-judicial foreclosure, then the local sheriff would conduct the auction of homes in foreclosure.
Foreclosure Notice
The notice or advertisement component comes into play as soon as the non-judicial foreclosure is initiated, at which time an advertisement will be published in the local newspaper for four weeks notifying the public of the foreclosure.
This is usually done after the sale of the home, because the lender will want to know if the sale price was less than the amount that the former homeowner owed. According to the statute of limitations, a lender has up to four years to file the deficiency judgment or the lender can cancel the deficiency judgment altogether.
Getting Help
Even though most foreclosures are non-judicial, it may be a good idea for a borrower to contact a foreclosure lawyer for assistance if you have received a foreclosure notice or if you believe you may face foreclosure. A foreclosure attorney can explain the process of foreclosure to you and guide you through, helping to protect your rights.
