Bankruptcy Overview

Detroit Michigan Foreclosure Lawyer

When you file for bankruptcy, foreclosure may not be far behind. As an experienced bankruptcy attorney, I, Walter Metzen can help you understand foreclosure and your rights within these types of situations.

If you already have a foreclosure matter that is pending against you, you must act quickly to file bankruptcy if you have not already done so. By doing this, you may be slowing down or even stopping the foreclosure process until the bankruptcy matter is sorted out.

It is important for you to understand that there are many, many foreclosure scams out there. Even mortgage companies may be guilty of scams. A mortgage company may tell you that they want to work with you, structure a loan workout, and help you work things out. Unless you have this in writing from the company, be very wary. Many companies have been known to give their customers facing foreclosure a false sense of security and then change their minds.

Do not let this happen to you! Get in touch with me as soon as possible to discuss your foreclosure matters. I can move quickly in order to stop or delay the foreclosure in many situations. However, once a foreclosure has been executed, not even bankruptcy can save the property.

General Foreclosure Procedure in Michigan

An attorney in the State of Michigan who is requested to commence an action for foreclosure must contemporaneously initiate the following requirements:

  1. conduct a title search;
  2. Commence publication of the foreclosure, which shall be issued once a week for four (4) consecutive weeks in a newspaper published in the county in which the property is located and the foreclosure sale must be held not less than 28 days from the first publication date.  The property must also be posted with notice of said publication by the Sheriff within the first fifteen (15) days of its commencement.  The foreclosure sale is then held at public auction, with an anticipated foreclosure sale date approximately 5-6 weeks later;

On VA loans counsel must order the appraisal on the date the client request the foreclosure proceedings to commence. On FHA and conventional loans no further action may be taken until the redemption period has expired.

Approximately one week prior to sale the attorney should obtain the up-dated escrow figures.  In the event that the escrow figures are incomplete, it is customary that a sale may be adjourned on a week to week basis. 

Approximately 3-4 weeks after the sale,  counsel should receive the FHA deed if applicable.  At that time, counsel should calendar the conventional loans for approximately 30 days prior to the expiration of the redemption period.  In the event that an investigation reveals that the property remains occupied after the sale, counsel must send a correspondence to the occupants, by certified and regular mail, advising them the exact date the redemption period expires and that they vacate the property prior to that date.  In the event that upon expiration of the redemption period, the property remains occupied, eviction may be instituted.  On FHA loans, allow approximately 90 days prior to the redemption expiration, since the regional office of the FHA must make an individual assessment whether the property is occupied or vacant. 

The recording of a VHA deed can be accomplished as soon as counsel receives the conformed copy of the Sheriff's Deed is returned by the County Recorder, which generally takes approximately 7-10 days after sale.  After recording the deed, the new owner must arrange for issuance of an Owner's Policy of Title Insurance and submit the final title evidence direct to the VA Regional Office.  

            The redemption period normally runs six (6) months from the date of sale, however in Michigan, on 1-4 family residences the mortgagor is entitled to possession, and the rents and profits, during the redemption period.  Moreover, if the security instrument is dated prior to January 1, 1965, or the property is in excess of 3 acres in size or the principal balance has been paid down in excess of one-third, there is a twelve (12) month redemption period.  If the property has been abandoned, the period is three months and if abandoned and there exists an outstanding mortgage, which the indebtedness is more than two-thirds of the original debt, the period is reduced to one month.

Foreclosure by Advertisement

In the event that the underlying mortgage instrument contains the usual power of sale language, the premises may be foreclosed by advertisement by publishing a notice for 4 consecutive weeks, at least once a week in a newspaper of the county within which the premises are located indicating that the mortgage will be foreclosed by sale of the premises.  A copy of the publication of notice, must be posted on the premises within fifteen (15) days after the first publication of the notice.  The sale must be conducted a public auction to the highest bidder.  The mortgagor or those claiming under him have one (1) year after the sale within which to redeem, except for the following:

  1. redemption period is six (6) months if the mortgage was executed on or after January 1, 1965 on commercial or industrial property or multi-family residential property exceeding four (4) units or in the case of a mortgage executed on or after January 1, 1965 on residential property not exceeding four (4) units and not more than three (3) acres in size where the amount claimed due at the date of the foreclosure notice is more than two-thirds of original indebtedness secured;
  2. redemption period is three (3) months in the case of a mortgage on residential property not exceeding four (4) units and not more than three (3) acres in size if the property has been abandoned;
  3. redemption period is one (1) month in case of a mortgage on residential property not exceeding four (4) units and not more than three acres in size if amount claimed due at date of foreclosure notice is more than two-thirds of the original indebtedness secured and the property is abandoned. (MCLA Sub. Sec. 600.3201-3280; MSA Sub. Sec 27A.3201-3280).  Effective May 15, 1986.

Section 3241a was enacted to encompass properties abandoned after the institution of foreclosure and may only be utilized on properties not exceeding 4 units and not more than three acres in size to reduce the redemption period.  Additionally, the property must be re-posted and mailings sent to the last known address of the mortgagor, advising of the intention to foreclose.  Upon expiration of a 15 day waiting period, the redemption period will expire 30 days following the mortgage foreclosure sale.

The mortgagor or any person lawfully claiming under him, or his personal representative, may redeem during the statutory redemption period by paying to the purchaser at the foreclosure sale, his personal representative or assignee, or to the Register of Deeds, the amount bid at foreclosure sale, plus interest, a fee of $3 and, where added by affidavits conforming to statutory requirements, certain sums advanced by the mortgages after the foreclosure sale in payment of property taxes, assessments, insurance premiums, and amounts necessary to redeem senior liens from foreclosure. (MCLA Sub. Sec. 600.3140, .3145, .3240; MSA Sub. Sec. 27A.3140, .3145, .3240).

Eviction Procedure

Upon expiration of the redemption period and the premises remain occupied, an eviction proceeding must be commenced by filing a Summons and Complaint with the District Court.  At the hearing the Court will determine the date by which the occupants must vacate.  Counsel must arrange for an inspection of the premises immediately after the hearing date.  In the event that the property remains occupied after the date the Court sets that the premises must be vacated, a Writ of Restitution must be filed.  Approximately 3-4 weeks after the Writ is issued the holdover tenants are removed.

Land Contract Forfeiture

An attorney in the State of Michigan who is requested to commence an action instituting a forfeiture proceeding, title work must be immediately ordered to determine who are all the parties in interest.  After receipt of the title commitment, and where required by the Contract, a Notice of Intention to Forfeit Land Contract must be mailed to all parties in interest.  Unless otherwise agreed to, a 15 day waiting period must elapse during which the parties need only reinstate the delinquent amount.  In the event that there is no reinstatement, a Notice of Forfeiture is then mailed to all parties in interest.  This notice allows an additional 15 days to reinstate the account.

In the event that the outstanding balance remains and no reinstatement occurs within this 15 day period, a Summons and Complaint must then be filed in the District Court of the Judicial District in which the property is located.  Personal service must be made on all parties in interest, upon which a three week publication commences, which sets forth the date of the forfeiture hearing.  At the hearing, forfeiture is normally granted and the judgment will be in the amount outstanding as of the day judgment is entered, plus allowable costs and statutory attorney's fees.

The forfeiture redemption period runs for 90 days from the date judgment is entered, unless the contract has been paid down by 50%, in which case the redemption period will be 180 days.  The owners are entitled to possession of the premises during this time.  In the event that redemption does not occur, a Writ may issued and the occupants removed from the property.  Upon return of the executed Writ by the District Court, the document is recorded at the Register of Deeds, at which time title is vested solely in the vendor of the land contract, subject of course, to any pre-dating interest.  In the event of a reinstatement of the judgment amount, the vendee is only obligated to redeem the judgment amount.

REVISED JUDICATURE ACT OF 1961 (EXCERPT)
Act 236 of 1961


600.3140 Mortgage foreclosure sale; redemption; amount stated in recorded affidavit; portions of premises.

Sec. 3140.

(1) The mortgagor, the mortgagor's heirs, executors, or administrators, or any person lawfully claiming from or under the mortgagor or the mortgagor's heirs, executors, or administrators may redeem the entire premises sold by paying, within 6 months from the time of the sale, to the purchaser or the purchaser's executors, administrators, or assigns, or to the register of deeds in whose office the deed of sale is deposited as provided in the court rules, for the benefit of the purchaser, the sum which was bid with interest from the date of the sale at the interest rate provided for by the mortgage.

(2) The vendee of a land contract, the vendee's heirs, executors, or administrators, or any person lawfully claiming from or under the vendee or the vendee's heirs, executors, or administrators may redeem the entire premises sold within 6 months from the time of the sale by paying to the purchaser or the purchaser's executors, administrators, or assigns, or to the register of deeds in whose office the deed of sale is deposited as provided in the court rules, for the benefit of the purchaser, the sum which was bid with interest from the date of the sale at the interest rate provided for by the land contract.

(3) The register of deeds shall not determine the amount necessary for redemption. The purchaser shall attach an affidavit with the deed to be recorded under this section that states the exact amount required to redeem the property, including any daily per diem amounts, and the date by which the property must be redeemed shall be stated on the certificate of auctioneer. The purchaser may include in the affidavit the name of a designee responsible on behalf of the purchaser to assist the person redeeming the property in computing the exact amount required to redeem the property. The designee may charge a fee as stated in the affidavit and may be authorized by the purchaser to receive redemption funds. The purchaser shall accept the amount computed by the designee.

(4) If the sum for redemption is paid to the register of deeds, a fee of $5.00 shall be paid for the care and custody of the redemption money.

(5) If payments are made as provided under this section, the deed of sale is void. If a distinct lot or parcel separately sold is redeemed, leaving a portion of the premises unredeemed, then the deed of sale is void only as to the portion or portions of the premises which are redeemed.

(6) The amount stated in any affidavits recorded under this section shall be the amount necessary to satisfy the requirements for redemption under this section.

 

 

Contact me, Detroit foreclosure lawyer Walter Metzen today to schedule your free initial consultation. Let me help you understand your rights and explore your options.

We are a Debt Relief Agency helping people file for bankruptcy relief under the Bankruptcy Code. Let us help you decide if bankruptcy is right for you.

Bankruptcy attorney Walter Metzen represents clients throughout Southeast Michigan, including the communities of Detroit, Southfield, Warren, Roseville, Farmington Hills, Ann Arbor, Belleville, Canton, Clinton Township, Dearborn, Dearborn Heights, Hamtramck, Highland Park, Holland, Howell, Lincoln Park, Livonia, Macomb, Northville, Plymouth, Port Huron, Redford, Rochester, Saginaw, Southfield, Sterling Heights, Taylor, Trenton, Troy, Westland, Wyandotte, Ypsilanti, Mount Clemens, Howell, Oakland County, Macomb County, Wayne County, Washtenaw County, Livingston County, and all of the surrounding areas.
 Content Footer

Walter Metzen
645 Griswold, Suite 3156
Penobscot Building
Detroit MI 48226
Map & Directions

Phone:(313) 962-4656
Fax:(313) 962-4241
Email:Contact Us
Board Certified Specialist, American Board of Certification