Attorney General’s Office
G. Mennen Williams Building, 7th Floor
525 W. Ottawa St.
P.O. Box 30212
Lansing, MI 48909
Tel: (517)373-1110
Fax: (517)373-3042
www.mi.gov/ag
Type of Document: Mortgage
Types of Foreclosure:
If the mortgage contained a power of sale clause, foreclosure can be
accomplished by foreclosure by advertisement, a non judicial form of
foreclosure. If the mortgage did not have the power of sale clause,
the foreclosure must take place in the courts.
Deficiency: A lender can sue for a deficiency in either type of
foreclosure. If the lender tries to obtain a deficiency after a non
judicial foreclosure, the action can be challenged by the owner. If the
sale took place at less than market value, the borrower can get the
court to credit full value of the property toward the sale price of the
house. This would make it very difficult to obtain a deficiency.
Redemption:There are many possibilities. In all cases the borrower
can redeem the property for the amount owed, plus interest. The
redemption period ranges from one month if the property is
abandoned and has two-thirds of the original loan balance remaining
to one year if over four units or three acres of land, and not
abandoned.
