Legal Foreclosure
Michigan what are the legal steps for a foreclosure on you home ?
I’m not sure about Michigan. But in my state- the mortgage company has to notify you of intend to foreclose, filed with the courts. They have to file it at least 3 weeks before the monthly foreclosure auction for that county. In my county, those foreclosure auctions are held the first Tuesday of evey month.
From there, if they foreclose- they have several options. They now own the home, but have to evict you. They can however change the locks on the property and only give you access to collect your personal belongings.
But the bank will sell the home. Sometimes, they sell it at the auction, but usually they do not. They put it on the market for sale. For example- if you own $150,000 and they sell the home for $100,000- you still owe the bank $50,000. Most banks won’t collect from you (you just lost your home- they know you don’t have the money). However, they will send you a tax form and that $50,000 can be counted as income that you have to pay a reduced tax rate on.
1 Legal Short Sales – Avoid Foreclosure
