Full question:
My Mortgage Company has been working on a Loan Modification on my mortgage for over 2 months. During those months, my mortgage has slipped into the 90 days past due category. While working on the Loan Modification, the Company informed me on multiple occasions (I called them approximately 3 times each month for the 2 months they were 'working' on the LM) that no monthly payment was required as the Loan Modification would bring the account current. The Loan Modification did not go through (I was not even aware that there was anything that had to go through). They called me and told me that they were going to GIVE me a Loan Modification. I had no idea that it was something that had to be applied for and approved) and the Mortgage Company, without any notice to me (I never received anything from them in the 2 month period, the only notice I received was a note posted to my front door from the Law Firm that is handling the foreclosure) has decided to proceed with foreclosure. The Company did not even send me any notice that they were unsuccessful with the Loan Modification. Does a Mortgage Company have an obligation to send a Lender a Notice of Right to Cure Default Letter if the mortgage gets to that point? Is it legal for a Mortgage Company to not send the letter, acknowledge that they did not and send it leaving the Lender with no idea that the Loan was in Default and still proceed with foreclosure?
- Category: Real Property
- Subcategory: Foreclosure
- Date:
- State: Michigan
Answer:
The most common method of foreclosure in Michigan involves what is known as non-judicial foreclosure. This type of foreclosure does not involve court action but requires notice of the foreclosure by advertisement. If the deed of trust or mortgage contains a power of sale clause and specifies the time, place and terms of sale, then the specified procedure must be followed. Although there is no default notice requirement under Michigan law the mortgage document will govern such notice provisions and if contained in the trust mortgage they must be adhered to.
Otherwise, the non-judicial power of sale foreclosure is carried out as follows:
A notice of sale must be published once a week for four (4) in a newspaper of general circulation in the county where the property is located. Within 15 days of the first publication of the notice a further notice must be posted at the property to be foreclosed.
The notice must contain the borrower and lenders name, a description of the property, the terms of the sale and the time, place and date of the sale.
The sale must be made at public auction to the highest bidder. The trustee or the sheriff of the county, if different, may conduct the sale between the hours of 9:00 am and 4:00 pm on the date specified in the notice of sale.
The sale may be postponed by posting a notice at the time and place where the sale was to originally be held. If the postponement is for more than one week, it must also be published in the manner as the original notice of sale was given.
The redemption period in Michigan is usually six months, except in situations where there are more than four units; less than 2/3 of the original debt owed, multiple acres and/or abandonment occur.
In order to redeem the property at this point you must pay off the mortgage, all interest and late fees, court costs, attorney fees, title and appraisal fees. If the sheriff deed holder paid taxes or insurance after the sheriff sale, the mortgagor must pay those fees as well. Redeeming the property by getting another mortgage is very difficult because of the bad credit rating that resulted from the foreclosure. Redeeming the property by selling it on the market is often a good option. If the property is redeemed, the original rights and obligations of ownership are reinstated.
This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.
