I’ve read in the news that the number of foreclosures in Michigan is subsiding. Unfortunately for many, that’s not the news I get in my office. What seems to be happening is families are staying in their homes longer due to delays by the mortgage companies in the foreclosure process, although the end result remains the same. Naturally then, one of the most common questions asked to me is “How long does the foreclosure process take?” For the average mortgage company, the foreclosure process begins like this:

• If you did not make a mortgage payment on September 1st, a late fee is added on or about September 16th. After 30 days of being late on any payment, the first derogatory report is given to the credit reporting bureau. This affects your credit score and makes it harder to obtain credit or low interest loans.
• Once you are three to four months behind on your house payment, most mortgage companies will demand the full three or four months of payments at once and will not accept any partial payments.
• After four months behind, many mortgage companies begin the foreclosure sale process. A law firm is hired to do the foreclosure paperwork, and attorney fees are added to the late fees and late payments. You will receive letters from this law firm informing you of the foreclosure. They will post your foreclosure proceeding in the local newspaper with a set sale date, often referred to as a sheriff’s sale.
• Mortgage modification programs generally must be agreed to by the mortgage company before the date of the foreclosure sale. Also, if you wish to save your home, a Chapter 13 bankruptcy can do so, but it must be filed before the date of the foreclosure sale to stop the sale from taking place.
• After you are four to five months behind on payments, a foreclosure sale takes place at the county courthouse in the county where the property is located.
• When the foreclosure sale or sheriff’s sale takes place, the homeowner still has a six month right of redemption or a twelve month right of redemption if the mortgage covers a house and approximately four acres of land. During the redemption period, the homeowner may redeem the property or sell it for the full amount owed on the mortgage, plus late fees and attorney fees.
• A Chapter 7 bankruptcy at any time during the foreclosure process discharges the legal obligation to pay any debt incurred associated with the home if you are surrendering the home, but does not affect the six or twelve month redemption period.
• After the six month or twelve month redemption period has expired, if the homeowner is still living in the home, they will receive a 30-day Notice to Quit and be summoned eventually to landlord-tenant court for eviction proceedings, which takes another two to three weeks.