1 Answer | Add Yours
There is no statute in Michigan's foreclosure laws that allows junior lienholders any redemption rights after a Sheriff's Sale has been conducted.
Among other rights, the homeowner whose ownership is foreclosed has the absolute right in Michigan to live in the house--without paying rent or mortgage payments--for the full six-month redemption period. In 2009, there were other rights given to a homeowner under threat of foreclosure, such as the right to a modification if the homeowner has the financial capability to meet new obligations imposed by the modification.
In most, if not all, states, junior lienholders have a right to redeem the property at the Sheriff's Sale--that is the only way available to them to protect their lien in a foreclosed property. If a junior lienholder chooses not to protect its lien at the Sheriff's Sale, it then becomes an unsecured lender--in other words, it no longer has any interest in the real property.
A junior lienholder who loses a lien, however, still has an outstanding debt owed to it and can seek repayment of that debt just as any other unsecured (for example, a credit-card compmany) creditor might, so the debt still exists, it just is no longer secured by a second mortgage on the real estate.
We’ve answered 328,229 questions. We can answer yours, too.Ask a question