If you’ve received a notice that your Michigan home is in danger of being forfeited due to unpaid property taxes, you might not know where to turn next.
Tax delinquent foreclosures, also known as “property tax forfeitures” and “property tax foreclosures” are frightening, especially when you thought you owned your home outright and had nothing to worry about.
It’s good to know that in Michigan, you have three years to get those taxes paid off, and even then you still have a few options.
The first step to getting back on your feet is understanding Michigan’s tax delinquent foreclosure process. When you know where you are in the property tax foreclosure process, you’ll have a better idea of what your options are.
Let’s start with Michigan’s definition of “tax delinquent.”
What does it mean to have “delinquent property taxes” in the state of Michigan?
In Michigan, the state considers a taxpayer in “delinquency of their property taxes” after a property tax payment has not been made.
If you missed your payment, your county treasurer will be notified on March 1st, and at that point, your home will enter the Michigan property tax forfeiture process.
If I Miss One Payment, Am I Immediately In Trouble?
No. You actually have three years to repay missed property taxes before your home is foreclosed on.
It’s best to pay those taxes back a soon as possible, though. The longer they go unpaid, the more fees and interest will accrue, making it more expensive to repay those taxes. For more information, take a look at our timeline of the entire process below.
When Is the Very Last Day I Can Pay My Back Taxes And Keep My Home?
To keep your home and avoid a property tax foreclosure, you must pay back all property taxes by March 31st of the third year of tax delinquency. Take a look at this example:
Sherry is a Michigan homeowner who wasn’t financially able to pay her property tax in 2016.
Since then, Sherry still has not been able to pay her property taxes.
If Sherry is unable to pay back all the taxes she owes by March 31, 2019, her home will be foreclosed on.
Sherry must pay all back taxes by March 31, or she must vacate her home on that date.
But I Own My Home, How Can the County Take It?
If you own your home outright, but haven’t been able to pay property taxes in the past few years, that means that you owe money on the home to the government.
If your property taxes are not paid in full by March 31, then your home will be foreclosed on by your county. You can learn more about this in the detailed timeline of Michigan’s property tax foreclosure process below.
What Happens After My Home Is Foreclosed On?
If your home is foreclosed on March 31, that is the date that you must vacate the property.
Depending on the county, there will be an auction of tax delinquent property foreclosures in July, August, or September. The county will use the time from March 31 (the date of foreclosure) to the time of the auction to get your home market-ready, so it can be sold at auction.
How Renewed Homes Can Help Homes in Danger of Tax Delinquent Foreclosure
Renewed Homes is a real estate investing company dedicated to helping community members move on from troublesome houses. If your home is in danger of foreclosure due to unpaid property taxes, we can help. Here are just a few of the ways we’re able to help homeowners in danger of losing their homes due to property tax foreclosure:
Because Renewed Homes offers fair, cash offers to Michigan homeowners, we can get you an offer, pay off your taxes, and close before March 31st. Our typical closing process takes 10-15 days, and we’ll pay out your back-taxes at close, so you don’t have to produce the cash on your own.
That means you get a cash offer for your home, and your back taxes paid off before your home is foreclosed on. You don’t have to produce any cash for the county, and you avoid foreclosure, the credit hit, and especially those built-up back taxes.
We know it’s not easy to part with a family home. For many, the March 31st move-out deadline is the scariest part of a Michigan tax delinquent foreclosure.
At Renewed Homes, we pride ourselves on our flexibility, and we work to truly help our Michigan community members. If you’re not ready to move out by March 31st, we’re more than happy to work with you to find an arrangement that’s more accomodating, but still avoids a foreclosure of your home.
A Fair Cash Offer To Help You Move On
If you’re working to get out from under a home that has delinquent property taxes, it can be tough to consider how you’ll ever move on.
Renewed Homes works to get you a fair, cash offer that will cover your back taxes, and still leave additional funds for you to move on. Whether you want to put a down payment on a new home or apartment, we’re dedicated to setting you up for a fresh start.
Timeline of Events – Michigan Property Tax Forfeiture and Foreclosure
In the state of Michigan, your home may not be foreclosed on due to unpaid taxes until three years have passed with unpaid property taxes. The first year, you will receive notices that your property taxes are in default.
The second year, the county will consider your home in forfeit (you haven’t paid your taxes, and are therefore forfeiting your home). In the second year, your home is considered to be in the “redemption” period. You may redeem your home at any point in these two years, so long as you are able to repay all taxes.
In the third year, on March 31st, if all back taxes have not been paid, the state will foreclose on your home. If you’d like a bit more information, take a look at this detailed timeline of the Michigan property tax foreclosure process:
The first year property taxes go unpaid
March 1 – If you missed your property tax payment for the year, your county treasurer will be notified, and will mark your property tax as delinquent. At this point, the county will also add a 4% administration fee as well as a 1% monthly interest rate to the property tax amount owed.
June 1 – The county treasurer sends a notice to the taxpayer or homeowner that the property tax has not been paid.
September 1 – The county treasurer will send a second notice to the taxpayer or owner.
October 1 – The county treasurer will add an additional $15.00 fee to the property taxes owed.
November 1 – The county treasurer will make a list of all the properties in your county that have not paid property taxes for the year.
The second-year property taxes go unpaid
February 1 – The county treasurer will send another notice, one each to the taxpayer, the homeowner, and any occupants of the home. At this time, the county treasurer may post notices of delinquent properties in the newspaper
March 1 – If your taxes from the previous year have still not been paid by March 1, your property is considered forfeited to the county treasurer. The county will add on an additional $175 fee, and an additional interest rate of ½% per month.
At this point, you can still remain in your home, but to redeem your property, you’ll have to pay back all taxes and fees that have accrued at once.
April 15 — The county treasurer will record a certificate of forfeiture. This certificate states that the homeowner or taxpayer has not paid their property taxes and has therefore forfeited their home.
May 1 — At this point, the Foreclosing Governmental Unit (FGU) gets involved. They will send a notice alerting the property owner of the show cause hearing.
At a show cause hearing, those with an interest in the property — the taxpayer, owner, and even occupants — have an opportunity to show why the property should not transfer to the FGU.
The FGU will also initiate a title search and will schedule a personal visit to the property in question.
June 15 — At this point, the FGU must file a petition for foreclosure of the forfeited property.
The third-year property taxes go unpaid
January-February — At some point in these months, the FGU mush show proof of the show cause and foreclosure hearings, as well as proof of their personal visit to the property in question.
March 30 — The circuit court must make a decision on the property by March 30, to decide whether the property may be foreclosed upon or not.
March 31 — Redemption Rights Expire. If your foreclosure was not contested, or if the courts ruled that your home is set to be foreclosed, this is the date of foreclosure. Occupants must vacate the premises.
— At this point, the government assumes the home. —
3rd Tuesday in July — This is the first opportunity for the property to be offered at auction. Two auctions must be held for each property (if they don’t sell in the first auction). A newspaper notice of the auction must be published at least 30 days before the auction.
The Michigan property tax foreclosure process is long and complicated. If you’re worried about your home, or if you have property taxes you know you won’t be able to handle by March 31, please don’t hesitate to call Renewed Homes.
We’re here to help, and are happy to work with you to find the outcome that is best for you. Our closing process is short, and we make cash offers so you can avoid your foreclosure immediately, and move on easily.
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