Michigan Foreclosure Listings Key Terms

Learn terms that describe types of foreclosures in Michigan

By Kimberly Huber

Foreclosure is a legal process that occurs when a lender or other lien holder repossesses the collateral, or the real property, in the case of a default. Banks usually foreclose on a home when a homeowner falls behind on mortgage payments. The laws in Michigan allow for different kinds of foreclosures, including judicial, non-judicial and government auction. The following key terms can help you understand the different types of foreclosure in Michigan.

Non-judicial foreclosure

Most foreclosures in Michigan are considered non-judicial foreclosures. This type of foreclosure occurs when a lender includes a clause in the mortgage contract that allows them to pursue a foreclosure without a court hearing in the case of a default by the homeowner.
Try: Foreclosure Listings offers more information on Michigan non-judicial foreclosures.

Right to redemption

The right to redemption is allowed by Michigan foreclosure law. This right allows the defaulting borrower up to six months from the foreclosure sale to pay the winning bid amount and any other costs incurred. By paying this, the defaulting borrower can regain the property from the winning bidder.
Try: Foreclosure University offers education, ebooks and foreclosure database searches by state.

Judicial foreclosure

Judicial foreclosures are handled by the court system, and are not as common in Michigan. The lender files and records a Lis Pendens notice, and the defaulting borrower is served and has the opportunity to go before the court. If the debt is considered valid and in default, the court issues a judgment and a writ is issued that authorizes a sheriff's sale or auction.
Try: More details can be found at All Foreclosure Information.

Notice of sale or auction

In Michigan, the notice of sale is required and the sale or auction itself cannot be fewer than 28 days from the initial publication. During this period, the notice of sale must be posted on the property. The notice of sale must list the names of both the lender and borrower and the mortgage or lien details, including the amount of default, the property's legal description and the period of redemption.
Try: RealtyTrac details foreclosure laws and regulations in the state of Michigan.

Real-estate-owned (REO) or bank-owned

REOs are lender-owned properties that have already been repossessed from the defaulting borrower, and they are often considered good investment opportunities. The perception is that banks will negotiate more on the price in order to close the sale quickly and get the debt off their books.
Try: Countrywide is a lender that offers REOs for sale.

Government auction foreclosure

These foreclosures occur in Michigan when a property owner fails to pay government liens, usually a property tax lien. Michigan law allows for foreclosure auctions of tax-delinquent real property.
Try: The State of Michigan Department of Treasury has foreclosure properties up for auction. Most of the county treasuries use Title Check to perform the auctions each year from June through November.