Third Party Sheriff’s Sale Purchaser Opportunity to Secure During Redemption
Of possible interest to Third Party Sheriff’s Sale Purchasers (or prospective purchasers), seeking to protect and secure their purchased property, in January of this year, MCL 600.3240(13) became effective, which allows a sheriff’s sale purchaser to inspect the interior of the foreclosed property during the redemption period and initiate an action for possession if the inspection indicates that the property is damaged. MCL 600.3237 and MCL 600.3238, effective June 19, 2014, replace MCL 600.3240(13) and outline the steps a sheriff’s sale purchaser must take in order to lawfully inspect the interior of the foreclosed property and commence an action for possession, during the redemption period.
Before inspecting the interior of the property, the purchaser must serve the mortgagor with two pre-inspection notices. The second of which must be at least seventy-two (72) hours in advance of the date of inspection. If the initial inspection of the interior reveals actual or imminent damage to the property, or the inspection is unreasonably refused, the purchaser can then send a notice of the purchaser’s intent to commence an action for possession, unless the property is repaired within seven (7) days after the mortgagor’s receipt of the notice. MCL 600.3238(11) provides examples of “damage,” including but not limited to local ordinance violations, exterior conditions that present risk of criminal activity on the property, stripped plumbing, electrical wiring, siding, or other metal material, missing or destroyed structural aspects.
The current version of the law provides the investor (third party purchaser), or its counsel, and the courts with greater guidance as to how an investor puts itself in a position to remediate conditions on a “damaged” property prior to expiration of redemption. With this greater guidance and clarity, local communities will hopefully begin to see investors bid more aggressively on at risk properties.
Leave a Reply
Want to join the discussion?Feel free to contribute!