Foreclosure Laws in Michigan – Can Michigan’s Foreclosure Law Save Your Home? Check it Out

The US economy has gone for a dip since last few years and the fall is being continued. All the homeowners are afraid of foreclosure which seems to be inevitable. The foreclosure laws in Michigan can yet help you save your home from being foreclosed in case you act on time. Let us first understand the key facts of the foreclosures in Michigan:

The key documents here are the trust mortgage. This is nothing but the deed of trust that is made while taking up the mortgage. The state allows for judicial as well non judicial foreclosures. The non judicial foreclosure is known as ‘foreclosure by advertisement.’ It does not involve the court procedures in the matter.

In order to conduct the foreclosure in the non judicial cases, the trust mortgage must have a ‘power of sale’ clause. This allows the attorney to foreclose the property by default in case any of the monthly payments are defaulted.

In case the auction is conducted by the sheriff, there is a certain procedure to be followed up for the notice of sale. In case any of its conditions is not met, the borrower stands a chance to save the home:

· The lender must get notice of sale published in the newspaper for 4 consecutive weeks. This refers to the area of the county where the property in consideration is located.

· Then within 15 days of publishing the first notice, one copy of the notice of sale must be posted to the property address.

· This notice must contain the name of the mortgagor, name of the mortgagee, the name of any assignees or party, the date of mortgage and it is recordation. The other things it must contain are delinquent amount, the legal description of the property, the place & date of the foreclosure sale and the length of any applicable redemption period.

· In case the property in consideration is a residential one that does not exceed the area of 3 acres and does not exceed 4 acres and the defaulted amount on the date of the notice of foreclosure is higher than 2/3 of the original face amount of your debt secured by the mortgage, you can enjoy a redemption period of 6 months.

· In case the property is abandoned and is not in use, the redemption period is reduced to 30 days only.

· Generally one can enjoy a redemption period of around 1 year.

· The borrower can go head in the court if he / she feels that the sale was conducted at a very low price or it was conducted in any unlawful manner.

California Foreclosure Law Changes

In June of this year, California foreclosure law was re-written by the Democratic Senator from San Leandro, Ellen Corbett. The new law mandates that lenders in the state notify the delinquent owner at least 30 days before beginning the foreclosure process. It also requires a lender who has not tried prior to this notification to work with their delinquent accounts in an attempt to change the terms of the mortgage to abide by a 90 day moratorium on the foreclosure process while they do so.

Proponents and naysayers alike have chimed in on this aspect of the new law. Some say it is not constructive in that it allows the negligent owner to remain in the home without payment for 3 months. Others say this it is a positive change because it gives the homeowner some leeway in finding their way out of the enforced sale.

Delinquent payers have up to five days before the schedule sale to reinstate the property back to them. This includes, of course, paying all outstanding debt as well as legal costs and penalties that have accrued.

If a power of sale exists in the original mortgage, the sale goes through a non-judicial foreclosure process. If, however, no notice of sale is present, the lender must file a lawsuit in order to obtain a court order to foreclose, and the sale then goes through a judicial foreclosure. A judicial foreclosure allows the borrower to redeem the property up to 12 months after the sale. You can see why, then, that the non-judicial foreclosure is the vehicle of preference for most California lenders.

The process and time-line for California foreclosure is clear: Notice of Default is filed with the county recorder and sent to borrower within 10 business days and then again within that first month of filing. After 3 months, a Trustee sale date is set. The month prior to sale is important as 25 days before, notice is sent to the IRS (if appropriate), 14 days before sale, the Notice of Trustee sale is recorded. The borrow can reinstate the property to themselves up to 5 days before the sale, and on sale date, the property goes to the highest bidder.

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Foreclosure Laws in Georgia

Georgia is both a judicial and non-judicial state; meaning the foreclosure process can occur both in court and out of court. A non judicial foreclosure can be completed in less than 2 months.

A judicial foreclosure can occur in the state of Georgia, when the trustee deed or mortgage lack the clause that permits the non-judicial proceedings. The foreclosure process begins when the lender files a petition. This petition will describe the default amount, property, and situation. A written notice is sent to the borrower, letting him/her know that they need to pay the default within 30 days. If this is not resolved, a sale date is scheduled.

Most mortgages and trust deeds these days have a clause permitting out of court proceedings. This makes the non-judicial way more prevalent in this state.

Georgia has no law that requires the lender to warn the borrower before it begins the process of foreclosure. But, the deed of trust or mortgage might state they should.

Georgia law does not give a reinstatement “right” to the borrower. But, if the deed of trust or mortgage states the borrower has the right to stop their foreclosure by paying of the default amount and any extra costs, a borrower can always stop the foreclosure process by paying the loan balance.

Four weeks before the sale, a notice about the sale is published, once a week. Around fifteen days before the sale, a notice is sent is sent to the borrower. This notice includes; lender and borrowers names; mortgage info, the location of the sale, a description of the property, a date and time.

The auction or foreclosure sale is at the county courthouse. This occurs the 1st Tuesday of every month. It is usually held between 10 and 4 pm. The winning bidder must have the full amount to give to the person conducting the sale. If the sale is canceled, the process starts all over again.

There isn’t a right of redemption in Georgia, after a foreclosure sale.

Using Foreclosure Law to Your Advantage

Foreclosure law varies from state to state with regards to the exact process that must be followed in order for a bank or lender to foreclose on your home. Knowing the foreclosure law in your state can help you negotiate with your lender and perhaps avoid foreclosure altogether.

One of the largest differences in foreclosure law is whether a state uses mortgages or deeds of trust for real estate. “Deed of trust” is a term that’s not heard as often as mortgage, but in essence, they have the same function – they protect the lender from default on a loan that is secured by real estate. The major difference is in the process the lender must use to obtain the right to recover your property and sell it.

When you sign a mortgage agreement with a lending institution, you retain the deed to the property, and have full legal title to it – but you allow the lender to place a ‘lien’ on it. If you do not make the payments on the loan as agreed upon, the lender can foreclose on the property.

In some states, a deed of trust takes the place of a mortgage. With a deed of trust, you give the deed to the land or property to the lender, but the lender can only use or sell the property if you default on the loan.

In states that use mortgages, foreclosure law makes foreclosure a judicial procedure. A lender must prove to the court that the borrower has defaulted on the loan, and that they, the lender, have made appropriate attempts to resolve the default with the homeowner. There is a definite sequence of events that must be followed as prescribed in the foreclosure law, and knowing that sequence in your state can help you understand your options in terms of resolving the issue before it goes before a judge.

In states that use a deed of trust rather than a mortgage, the lender must go through certain steps of notification as required by foreclosure law in that state, but does not need judicial permission to proceed with a sale or foreclosure on the property to which they hold a deed in trust.

States whose foreclosure law requires judicial action include: Alabama, Arizona, Arkansas, Connecticut, Delaware, Florida, Montana, Nebraska, New Jersey, New Mexico, New York, North Dakota, Ohio, Oklahoma, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Pennsylvania, South Carolina, South Dakota, Vermont, Washington and Wisconsin.

Being Aware and Understanding Foreclosure Laws

Generally, laws differ from one state to another. However, some states have corresponding laws that could help you a lot in dealing with foreclosure.

Remember that these tips are based on foreclosure law that appears similarly on both the federal and state fields. Exceptions might exist, again depending on the state’s own decisions. You must be aware of the two existing foreclosure processes that you or the court could choose. The first is called the Judicial Process. In this procedure, the court would decide whether the property-provider would need to file a suit against the property owner. In this case, the court may also determine if the property provider truly means the file. They would also double check whether or not payment discrepancies really exist. This might be a lengthy process for you to undergo. That is why many choose to have the rather easier Non-Judicial Process.

The Non-Judicial Process would require another person to buy the property in question. This way, the property-owner can still pay the outstanding loans using the third party’s prior payments. He may even loan for another property just to start the whole thing again. However, in case you are approved for another loan, be sure that you can now fully pay the monthly installments you have requested for.

Whatever you may choose, make sure that your senses are keen in detecting any cases of irregularities. Ignorance is never an excuse, so study more about the foreclosure law governing the state you are in to ensure that your rights are being protected.