Mackinac County Foreclosure Prevention
It is a top priority of the Register of Deeds and the County Treasurer to help you keep your property out of foreclosure. We want property owners to know that there are options available to avoid foreclosure. The materials and links below could be the help you need to keep your home.
Definition: Foreclosure is a legal process by which a bank, mortgage company lender, or other creditor takes property which has been mortgaged in order to satisfy a debt. A foreclosure will result from the non-payment of the mortgage (including second mortgages and home equity loans) or the property taxes on the real estate used as security on the mortgage. As a result of foreclosure, at the end of the redemption period, the owner loses the rights he or she had to the real estate.
Your home, more than likely, is the largest asset you will ever own. In Michigan, the deed to your home is recorded at the Register of Deeds Office. All the mortgages, unpaid tax liens, etc. against the property will also be recorded/deposited in our office.
When you purchase your home, you usually have 4 basic expenses: Monthly Payment, Interest, Taxes, and Insurance. These four expenses combined usually make up your monthly payment. If you fail to make your monthly payments your bank has a right to begin foreclosure proceedings against you.
If you are responsible for paying your property taxes directly (instead of including the taxes in your monthly mortgage payment) and you stop paying the taxes, your bank, when it becomes aware that your taxes are delinquent, will usually take over and make these payments for you. The bank /lender is willing to do this, because if the taxes remain unpaid, the County Treasurer’s Office can take the property and the bank’s security interest would be significantly compromised. Once the lender has paid your delinquent taxes, you would have to repay the bank/lender, rather than the County Treasurer. As a result the bank/lender at this time, could start foreclosure proceedings against you.
When the bank /lender starts foreclosure proceedings against you that is referred to as a Mortgage Foreclosure. If the mortgage continues to go unpaid the foreclosure will proceed to a Sheriff’s sale (public offering) of the property at which sale a Sheriff’s deed is usually issued.
A bank/lender will typically protect its loan by buying the foreclosed mortgage back at the Sheriff’s Sale, however, as the Sheriff’s sale is a public sale, anyone could bid on the foreclosed properties at that sale. Any potential purchaser of that foreclosed mortgaged premises must keep an eye on the number of other mortgages on the foreclosed premises and whether there are any delinquent property taxes which are being foreclosed upon by the County Treasurer’s Office. Tax foreclosures take precedence over mortgage foreclosures in terms of who has a priority ownership rights to the property.
Tips to Avoid Mortgage Foreclosure
- Don’t ignore the problem. The further behind you become, the harder it will be to reinstate your loan and the more likely that you will lose your home.
- Contact your lender as soon as you realize that you have a problem. Lenders do not want your home. They have options to help borrowers through difficult financial times.
- Open and respond to all mail from your Lender. The first notices you receive will offer good information about foreclosure prevention options that can help you weather financial problems. Later mail may include important notices of pending legal action. Failure to open mail will not be an excuse in foreclosure court.
- Know your mortgage rights. Find your loan documents and read them so you know what your lender may do if you can’t make your payments. Learn about foreclosure laws by contacting the Michigan State Housing Development Authority at 517-373-8370.
- Understand foreclosure prevention options. Valuable information about foreclosure prevention (also called loss mitigation) options can be found at the Federal Housing Administration website.
- Contact a HUD-approved housing counselor. The U.S. Department of Housing and Urban Development (HUD) funds free or low-cost housing counseling nationwide. Housing counselors can help you understand the law and your options, organize your finances, and represent you in negotiations with you lender if you need this assistance. To find a HUD approved counselor click here, or call 1-800-569-4287 or TTY 1-800-877-8339.
- Prioritize your spending. After health care, keeping your house should be your first priority. Review your finances and see where you can cut spending in order to make your mortgage payment. Look for optional expenses that you can eliminate such as cable TV, membership or entertainment.
- Don’t lose your home to foreclosure recovery scams. If any firms claim they can stop your foreclosure immediately if you sign a document appointing them to act on your behalf you may well be signing over the title to your property and becoming a renter in your own home. Never sign a legal document without reading and understanding all the terms and getting professional advice from an attorney, a trusted real estate professional, or a HUD approved counselor.
- Avoid foreclosure prevention companies. You don’t need to pay fees for foreclosure preventions help, use that money to pay the mortgage instead. Many for-profit companies will contact you promising to negotiate with your lender. While these may be legitimate businesses, they often charge a hefty fee (often two or three month’s mortgage payments). Contact your lender or a HUD-approved housing counselor to find out about free help that they can provide.
For a list of other counseling services, visit http://portal.hud.gov/hudportal/HUD.
Resources can also be found online at www.michigan.gov/mshda or by calling (866) 946-7432; ask about the “Save the Dream” program.
- Don’t lose your property and damage your credit history.
- Call or write your bank /lender immediately and be honest about your finances.
- Stay in your home to make sure you qualify for assistance.
- Arrange an appointment with a housing counselor (most are free).
- Cooperate with the counselor or bank trying to help you.
- Explore every alternative to keeping your property.
- Beware of scams and predatory lenders.
- Don’t sign anything you don’t understand.
Once you are in foreclosure you retain control of your property for 6 months, 12 months if you have more than 3 acres. During this time you can refinance or sell your home. Everyone has choices. When faced with foreclosure you must take advantage of all your choices.
Mortgage Foreclosure Prevention & Information:
- How To Avoid Foreclosure
- VA Loan – Avoiding Foreclosure
- Freddie Mac on Avoiding Foreclosure
- Predatory Lending
- Home Lending and Foreclosure Scams
- IRS Questions on Home Foreclosure and Debt Cancellation
- Foreclosure Prevention Resource Center
- Foreclosure Prevention Toolkit
- Federal Trade Commission – “Looking for the Best Mortgage”
- Federal Housing Administration – US Department of Housing and Urban Development
- A Home Buyer’s Self-Directed Course – Homebuyers Checklist
- Prioritize Your Debt – Financial Security: Managing Money in Tough Times
- Career Development, Budgeting, Credit 101, Debt Management, Family Stress & Money & More – MI Money Health
We hope this site contains information that is helpful to you, but if you have questions please contact us by telephone 906-643-7306.
A big “Thank You” to Michelle Stine, Emmett County Register of Deeds, James Lucas, MSU Extension District 2 Coordinator, Jenny Pierce, PC Specialist, Chippewa County IT Department, and Michigan Association of Registers of Deeds for all their help in composing this webpage.
Register of Deeds