Overview of Shortening Redemption in Michigan

By Regina Slowey & Caleb Shureb

_

November 30, 2017 – The vast majority of foreclosures in the state of Michigan receive a statutory six-month redemption period. During this period the owners/occupants maintain all of the rights and privileges that they held prior to the foreclosure. In an effort to reduce blight and criminal activity while simultaneously attempting to preserve the integrity of the local real estate market the Michigan legislature provided MCL 600.3241a. This statute allows for a foreclosing mortgagee to reduce the typical statutory redemption period from six-months to 30 days (or until the required fifteen-day notice period expires, whichever is later). MCL 600.3241a is all about occupancy. While there are clearly many definitions that can be applied to the term “abandoned”, MCL 600.3241a unambiguously states that there is a conclusive presumption that the premises have been abandoned if neither the mortgagor nor persons claiming under the mortgagor are presently occupying or will occupy the premises.

_
In the event that a foreclosing mortgagee believes the property to be unoccupied notification to their local counsel can result in a significant reduction in the redemption period. The
abandonment process includes a notice that is posted at the time of making the official personal inspection and a copy of the notice is submitted by certified mail, return receipt requested, to the mortgagor at the mortgagor's last known address. These notices state that the foreclosing mortgagee considers the premises abandoned and provides the instructions by which a contest to the abandonment can be submitted.

_
On the other hand, the state of Michigan provides a method by which the redemption period may be shortened regardless of occupancy status. This method, pursuant to MCL 600.3237 and 3238, is based upon waste and damage, actual or potential, to the property. This process is fairly cumbersome, but it does allow either the mortgagee or a third party a way to protect the asset from further damage during the redemption period and receive a preemptive writ of restitution.

_
A link to MCL 600.3241a can be found by clicking here:

http://www.legislature.mi.gov/(S(rbxljqull5qdwzgvsz3ao45o))/mileg.aspx?page=getObject&objectName=mcl-600-3241a

A link to MCL 600.3237 and 600.3238 can be found by clicking here:
http://www.legislature.mi.gov/(S(lpefmxgdqsfntknwbwqf5tim))/mileg.aspx?page=getObject&objectName=mcl-600-3237

http://www.legislature.mi.gov/(S(wxs0tg4tk1hkssygii4inj30))/mileg.aspx?page=getObject&objectName=mcl-600-3238

_

Should you have any questions regarding the above please feel free to contact Orlans PC Attorney Caleb J. Shureb at cshureb@orlans.com or direct at 248-502- 1363 or Orlans PC Attorney Regina Slowey at rslowey@orlans.com or directly at 248-502- 3070.