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What to Know About Michigan Property Tax Foreclosure

Foreclosure is a scary word. What does it mean? What can be done to stop it? Here’s everything you need to know about Michigan Property Tax Foreclosure.

What does property tax foreclosure mean?

If you don’t pay the real property taxes on your home, you will eventually lose your home, in other words, it will be foreclosed. Fortunately, in Michigan, the property tax foreclosure process takes about three years.

If property taxes are not paid by March 1st, the property is considered in delinquency. Taxes can still be paid, but late fees may apply. After the second year, the property is forfeited to the county treasurer and the foreclosure process begins. This does not mean you have lost your home.

The next year is referred to as the redemption period. During this period you have about one year to pay back the taxes owed on the property. If the taxes are still not paid as of March 31st of the third year, the county treasurer will take ownership of the property and can put it up for sale. At this time the property is fully foreclosed and tenants must vacate the premises.

How long do I have before I lose my home?

The entire property tax foreclosure process in Michigan takes about three years. If you have received a notice of forfeiture, you still have a year to pay your taxes to keep your home. If you are able to do this, the foreclosure process will be stopped. However, if you are unable to pay back your property taxes, at the end of the process it is likely your home will be foreclosed.

What can I do to stop the foreclosure?

Once your home is in the foreclosure process, you have a few options. The first is to pay what is owed on your home, plus a little in interest and fees. You may be eligible for reduced or deferred taxes if you are elderly, disabled or meet specific income requirements. If so, you must apply for deferment using an application and submit it to your county treasurer by the deadline.

If you are not able to pay the full amount of property tax you may be able to reduce the amount of taxes owed. Property taxes are based on your home’s estimated value. If you can contest the reduced market value of your home, you may have to pay less tax.

Finally, if you are still unable to afford the Michigan property tax and avoid foreclosure, you may wish to sell your home. This option enables you to be rid of the debt and move on with your life in a new home you can more securely afford.

How do I sell my home?

When it comes to selling your home you can either sell it yourself or sell it via a reputable real estate investor. Let’s explore what that means for you:

Sell it Yourself

Selling your home yourself means you solely are responsible for preparing your home for sale, marketing it to prospective buyers, and following through with any inspections or closing processes after an offer is accepted. This process can take anywhere from 6 months to a few years, depending on how many changes you must make to the property to prepare it for selling, and how long it takes to find a buyer. Even after doing this, inspections and the closing process may delay the final sale by weeks or months.

If you are keen to DIY and have a knack for navigating the fluctuating housing market, you may feel comfortable selling your home on your own. If, however, you are facing a tax delinquent foreclosure, and you don’t have much time to pay back those property taxes, it’s a good idea to seek the help of a real estate investor to move the process along quickly.

Sell to a Michigan Real Estate Investor

Selling your home to a real estate investor has many advantages. They will help you out of your back taxes right away, so you don’t have to worry about the government knocking on your door.

A real estate investor will give you a fair price for your home, something that isn’t guaranteed if you try to attract a buyer on your own. They will work with your timeline and you won’t have to worry about making changes to your house to get it ready to sell. For many homeowners, this process is a simple and stress-free way to get on with your life and out from under the weight of your debt. 

Whatever route you decide to take, there are resources to help you. Here at Hometown Development, we know the Michigan property tax foreclosure process can be long and confusing. If you have questions about a home in the property tax foreclosure process, or to sell your home before it’s foreclosed on, give us a call at 616-379-3090 or contact us online today to discuss your options.

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Sorry, This property is outside of our service area. We can only help with properties located in Michigan.