Foreclosure is the process through which the lender in a mortgage takes ownership and/or possession of the property that secured the original loan. This happens when a debtor in Novi, Michigan has repeatedly failed to make their payments. When a house is foreclosed, it is usually sold at auction shortly thereafter. This is because banks usually want to get rid of the property as soon as possible, even if it means losing some money, and an auction is an easy way to do this.
In every state, including Michigan, there is an option to go through foreclosure by a judicial sale, which is a procedure in which a court supervises the sale of the property, and makes sure that the proceeds first go the to the holder of the mortgage, then to anyone else who may have a lien on the property, and finally to the debtor if anything is left. In many states, original mortgages (as opposed to refinanced loans) are "non-recourse" loans, meaning that the most the lender can collect is whatever the foreclosed property sells for. The bank cannot go after the borrower for the balance, if the sale nets less than the amount due. You should consult a Lawyer in Novi, Michigan to learn the details of the law here. You should also know that this rarely applies to loans which have been refinanced.
How Can I Avoid Foreclosure in Michigan?
Most importantly, you must not ignore the problem. Doing so will not make it go away, and will probably make it worse. You should stay in close contact with your bank, and be honest with them. It is necessary to remember that the bank does not really want your Novi house - they expected to make a profit through the interest on your loan, and that's what they'd prefer to do. Accordingly, they will probably make reasonable accommodations to your financial situation if it means that you will be able to make some form of payment to them.
If you can't reach a solution with your lender, there are other options. You could, for example, try a "short sale," which allows you to sell your house for whatever amount you can get, and use the proceeds to pay your mortgage. If the house sells for less than you owe, the bank will get the proceeds of the sale, and the rest of the debt will be forgiven. You might also try a "short refinance" which allows a piece of the debt to be forgiven, and the rest refinanced. This allows the bank to wash its hands of the matter, while taking a relatively small loss, and allows the homeowner to keep their home.
How Can A Novi, Michigan Attorney Help?
If you are faced with the possibility of foreclosure in Novi, Michigan, an Attorney might be able to help. At the very least, he or she can advise you of your legal options.