How to Buy Michigan Foreclosures
In Michigan, foreclosure proceedings take approximately 60 days from start to finish. Michigan also offers homeowners a right to redeem a property for six months after the foreclosure is completed, which can make a foreclosure purchase somewhat complicated.
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Right of Redemption
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Michigan offers a right of redemption for homeowners post foreclosure. If the homeowner can produce the sales price and court costs for the property within six months of the foreclosure date, the homeowner receives property rights and any new buyer must forfeit possession.
Ways to Purchase
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There are two ways to purchase a foreclosed home in Michigan: either at a foreclosure auction or on the open market as a real estate owned (REO) property. When purchasing a foreclosure at auction the lender will retain the deed and rights to the property until the redemption period has expired. When purchasing an REO property on the open market, the redemption period is expired, allowing transfer of ownership rights at settlement. Once a property has reached REO status, the right of redemption is extinguished.
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Public Auction
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To purchase a Michigan foreclosure at a public auction, the buyer must bid at the auction. The county court sets the auction date and the sheriff's department administers the auction. The method for bidding is via public outcry either at the courthouse or in front of the property. Bidding hours in Michigan are between 9 a.m. and 4 p.m.
REO
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Purchasing REO property in Michigan follows nearly the same process as a retail real estate transaction. The primary difference is that an REO sale is "as is" meaning that there is no negotiation for repairs as there would be in a retail transaction.
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References
- Photo Credit lighthouse in northern michigan image by Alexey Stiop from Fotolia.com
