Effective January 10, 2014, Michigan’s foreclosure by advertisement law will now include another provision that allows purchasers at a sheriff sale the ability to extinguish the redemption period early. The new law will give the purchasers the ability to inspect the interior and exterior of the property (after the sheriff sale) and if damage to the property is imminent or has already occurred, the purchaser can immediately file an action to evict the current occupants. Currently, the purchasers only have 2 options 1) wait out the 6 month redemption period before filing for eviction; or 2) have declared the property abandoned before the sheriff sale, and wait 30 days after the sheriff sale.
For purchasers/investors this will be a much anticipated resolution to damage and destruction that occurs to their new property during the redemption period. For homeowners/occupants, this will be another way unscrupulous purchasers/investors can take advantage of them; landing them in the streets a lot quicker. Whether you are a purchaser/investor or a homeowner/occupant facing foreclosure, you must consult with an attorney to preserve your rights.
MCL 600.3240(13) will be amended as follows:
After the sale under section 3220 and periodically throughout the redemption period, the purchaser at the sale may inspect the exterior and interior of the property and all ancillary structures. If inspection is unreasonably refused or if damage to the property is imminent or has occurred, the purchaser may immediately commence summary proceedings for possession of the property under chapter 57 or file an action for any other relief necessary to protect the property from damage. A court shall not enter a judgment for possession in an action under chapter 57 if, before the hearing for possession, the mortgagor repairs any damage to the property that was the basis for the action. If a judgment for possession is entered in favor of the purchaser, the right of redemption is extinguished and full title to the property vests in the purchaser. As used in this subsection, “damage” includes, but is not limited to, any of the following:
(a) The failure to comply with local ordinances regarding maintenance of the property, if the failure is the subject of enforcement action by the appropriate governmental unit.
(b) A boarded up or closed off window or entrance.
(c) Multiple broken and unrepaired window panes.
(d) A smashed through, broken off, or unhinged door.
(e) Accumulated rubbish, trash, or debris.
(f) Stripped plumbing, electrical wiring, siding, or other metal material.
(g) Missing fixtures, including, but not limited to, a furnace, water heater, or air conditioning unit.
(h) Deterioration below, or being in imminent danger of deteriorating below, community standards for public safety and sanitation.
(i) A condition that would justify recovery of the premises under section 5714(1)(d).