All Forum Posts by: Rob M.

@Dion

I am not saying you are wrong but I ave done a lot of research on Junior Lien Redemption rights in Michigan and can not find any Statute that states they can redeem after the foreclose sale.

Per the Michigan Court of Appeals,

Quoting Stock Building Supply LLC v. Federal Deposit Ins. Corp., Docket No. 3604421 (Mich App, 2010)
It is well accepted that the foreclosure of a senior mortgage extinguishes the lien of a junior mortgagee where the junior mortgagee did not redeem at the foreclosure sale. Advanta National Bank v. McClarty, 257 Mich.App. 113, 125, 667 N.W.2d 880 (2003), citing Swarthout v. Shields, 185 Mich. 427, 431, 152 N.W. 202 (1915).

Two rental properties I was watching in michigan just sold at sheriffs sale. Both had only one mortgage. First was for 96k and the second was 94. Both were bought back by the lender at 26k a piece. Same owner of both rentals short saled it during the redemption period. First was for 16k and second was 15k. The bank then slapped the owner with a 1099 on both.

I am not a lawyer but I agree with Geof that the redemption period is for the homeowner and that junior lien holders can't redeem a property during the redemption period. However, I have talked to three different lawyers, one of which owns a title company, and all of them tell me that junior lien holders can redeem during the redemption period. The thing that bothers me is the fact that non of them can actually show me which Michigan statute states this.

The redemption amount will be stated right in the sheriff deed and affidavit of Purchaser.

Also, I wouldn't recommend redeeming any property with multiple liens on it. Essentially redemption voids the foreclosure as if it never happened, hence bringing back to life all junior liens.

Thanks for the response Geof. I will contact my attorney forsure. I guess I was thinking that if the quick claim states that she is also terminating the six month redemption period that it would also end the redemption period as well for the second lender. I was also under the impression that the foreclosure of the first automatically wipes out the second. The second mortgage was roughly 100k and they will receive 26k from the first loan forclosure as it went over that much at auction.

Hello

I live in Michigan and have recently purchased a house, which I intend to live in, at a sheriff's sale. Since you seem to have experience in doing this I was wondering if maybe you could answer a few questions for me. I would really appreciate it. The home I purchased had two mortgages on it with two different lenders, both of which were foreclosed. The sheriff sale was for the first mortgage and the lender put in their bid amount and I bid higher and received a sheriff's deed. I know there is a six month redemption period in Michigan, which I do not want to wait for the pass and I fear the house may be torn to shreds by that time. I contacted the current owner who is still living in the home and offered her 5k to sign a quick claim deed and vacate the premises, to which they agreed. The sale went over the first lenders opening bid by 26k. I assume that the 26k will go to the second lender as there are no back taxes or any other liens on the property.

1. By her signing the quick claim deed will that end the redemption period?

2. The second lender did not attend the sheriff sale nor bid on it. Can they still claim the property during the 6 month redemption period?

3. Can the second mortgage do anything at this point to stop me from taking possession?

@Geof Greeneisen

Hello

I live in Michigan and have recently purchased a house, which I intend to live in, at a sheriff's sale. Since you seem to have experience in doing this I was wondering if maybe you could answer a few questions for me. I would really appreciate it. The home I purchased had two mortgages on it with two different lenders, both of which were foreclosed. The sheriff sale was for the first mortgage and the lender put in their bid amount and I bid higher and received a sheriff's deed. I know there is a six month redemption period in Michigan, which I do not want to wait for the pass and I fear the house may be torn to shreds by that time. I contacted the current owner who is still living in the home and offered her 5k to sign a quick claim deed and vacate the premises, to which they agreed. The sale went over the first lenders opening bid by 26k. I assume that the 26k will go to the second lender as there are no back taxes or any other liens on the property.

1. By her signing the quick claim deed will that end the redemption period?

2. The second lender did not attend the sheriff sale nor bid on it. Can they still claim the property during the 6 month redemption period?

3. Can the second mortgage do anything at this point to stop me from taking possession?