Legal Question in Real Estate Law in Michigan

Avoiding forclosure

I am a single woman who purchased a home about 4 months ago. I have been working 7 days a week trying to make it and I can't seem to make ends meet. I have one payment past due now and I know I will not be able to make the payment by the end of the month. The mortgage company called me yesterday and said that if the payment was not recieved by the end of Jan. the would start forclosure proceedings on Feb. 1st. I have no objections to trying to sell the house (it is in perfect condition and well worth what I payed for it)but obviously I can't sell by the end of this month. I am afraid that I won't even be able to get into an apartment with undesireable credit and a fresh forclosure on my record. What would happen if I just ''handed over'' my house to the bank. Will they still forclose? Will my credit show that I forever owe 85,000?

Also I do have an issue that may or may not be helpful. I have a very ill daughter in another state. She has serious heart problems and two small children. Her health has taken a change for the worse which is a major reason I am behind due to the trips to tend to her and missing work. She may need me to physically be with her forever to help take care of them. Would this emergancy situation help?


Asked on 1/20/07, 10:12 am

1 Answer from Attorneys
Christopher Sevick Law Office of Christopher Sevick, PLC

Re: Avoiding forclosure

This is an all to common questions that I have been hearing lately. First, contact you mortgage company, ask for "loss mitigation", and see about informing them of your situation. They should send you an information packet that will allow you to disclose your finances to them and either work out a repayment plan or other option.

If the bank does foreclose you will in most cases have a 6 month redemption period after the foreclosure. That means that if you list the home for sale now, you can have it for sale and potentially sell it within the next 7 months and pay the loan off. You will of course have the foreclosure on the credit record, but it will show as "redeemed" and paid.

The first step is to get in touch with the mortgage and loss mitigation and then see about listing the home for sale. Secondly, if you need a contact for a Realtor I will be more than happy to direct you to one who may be able to assist you as well as I am an Associate Broker in Real Estate as well as an attorney.

Chris

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Answered on 1/20/07, 3:18 pm


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