Michigan Foreclosure Process

Under the new Michigan Foreclosure laws, lenders are forced to pursue a Judicial Foreclosure if they fail to execute a loan modification for an eligible borrower during the 90 day pre-foreclosure period.  While is a lengthy and more costly option for the mortgage company, it also creates a legal judgment against the borrower.

Don’t delay in seeking professional help to resolve a judicial foreclosure. Whether your intention is to keep the home or not, proactively dealing with the proceeding is imperative.

Acclaim Legal Services specializes in foreclosure prevention and debt resolution.

• If you wish to keep the property, we can legally stop the sale and set up reasonable repayment terms through Chapter 13 debt consolidation.
• If you are no longer able to maintain payments on the home, you can eliminate the judgment as well as other unsecured debts through filing a Chapter 7 bankruptcy. An ignored judgment will likely turn into a wage or bank garnishment which can have devastating effects on your budget.

Call us today at 866-261-8282 for free consultation on how to best resolve your judicial foreclosure and outstanding debts. All of our licensed attorneys are experienced in Michigan foreclosure law and qualified to advise you on your best debt resolution option.

What is the Judicial Foreclosure Process?

To initiate the judicial foreclosure process, the lender must:

• File a complaint in the Circuit Court where the property is located.
• Serve the borrower with the complaint as to provide notice of the foreclosure.
  • The complaint should state what debt is owed and explain why the default should allow the mortgagee to foreclose and take the property given as security for the loan.

Upon receipt of the complaint, the borrower has 21 days to file a responsive pleading.

• The Court will dismiss the complaint if the borrower pays the mortgagee the principal and interest due plus any additional costs prior to the judgment of sale.
• Upon conclusion of the case, whether the parties appear before the Court or whether a default judgment is entered, if the Court finds the borrower in default it will enter a judgment against the borrower.
• The Court will then execute the judgment by ordering a sale of the property.
  • While the Court has the power to order a sale of the property, the sale cannot take place until 6 months after the complaint was filed (3 months for land contracts).
  • The borrower may still satisfy the mortgage by paying the required principal and interest plus costs after judgment is entered but before the sale occurs.

It is important to note that the borrower may be personally liable for any deficiency in the sale price.  After the sale, the borrower has 6 months to redeem the property.

Stopping a Michigan Judicial Foreclosure Sale

At any point in the judicial foreclosure process prior to the court-ordered sale occurring, you may file a Chapter 13 bankruptcy to stop the foreclosure sale and set up repayment terms with your lender.  This will provide you with legal protection from the judicial foreclosure and reasonable repayment terms to bring the mortgage current over a 36 – 60 month time period. Other distinct benefits of this debt consolidation plan are:

• Ability to remove a second mortgage or home equity loan to reduce total mortgage balance on home

• Stop other creditor actions such as: vehicle repossession, judgments, garnishments, utility shut—offs, etc.

• Prioritize your budget: The program ensures that your secured debt obligations (mortgage, vehicle payment(s), etc) and monthly living expenses are paid each month before monies are paid to unsecured creditors.

• Improve your credit: by focused efforts to reduce principal debt therefore lowering your debt-to-income ratio and restoring consistent, timely payments to your creditors each month.

If you don’t stop the court-ordered judicial foreclosure sale, you will need to address the debt resulting from the deficiency judgment.  This debt becomes unsecured debt after the sale occurs and can be eliminated in a Chapter 7 bankruptcy with other unsecured debts such as:

• Credit cards
• Medical bills
• Judgments
• Loan deficiency debt
• Personal Loans
• Certain older tax debts
• Utility bills, etc.

Put our experience to work for you

Facing a foreclosure can feel overwhelming. Working with an experienced team of foreclosure specialists can quickly reduce that stress by providing resolution to the foreclosure situation as well as other debts. Acclaim Legal Services has a proven track record of success resolving foreclosure matters and providing lasting debt relief and resolution for our clients. We offer same day protection and free consultations, call us today at 866-261-8282.

We offer free in-office or phone consultations to review your personal circumstances, analyze your situation and advise you on the best course of action. We specialize in bankruptcy law, debt resolution, foreclosure prevention and credit repair. We have offices in Southfield, Dearborn, Flint, Ann Arbor and Warren, Michigan. Please call us toll free at 866-261-8282 or click here to schedule a consultation right now.