State Foreclosure Law Library

michigan

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Michigan — Tax & Mortgage Foreclosure

Legal information, not legal advice. Verify against the cited primary sources before acting. Last verified: 2026-06-01.

Michigan is a tax-deed state with judicial in-rem property-tax foreclosure under the General Property Tax Act (GPTA, 1893 PA 206). It is nationally important to surplus law because the Michigan Supreme Court’s rafaeli-v-oakland-county-2020 held — three years before tyler-v-hennepin-county reached the same result under the federal Fifth Amendment — that a foreclosing unit’s retention of surplus proceeds beyond the tax debt is an unconstitutional taking under the Michigan Constitution. The Legislature then created the MCL 211.78t claim process to return “remaining proceeds” to former interest-holders.

0. Identity & Classification

  • Recording unit: county (count: 83)
  • Tax sale type: tax deed (in-rem judicial foreclosure; the county/State, as Foreclosing Governmental Unit “FGU,” takes fee-simple title by judgment, then sells). No tax-lien certificates.
  • Tax foreclosure process: judicial (in-rem; circuit court judgment of foreclosure under MCL 211.78k)
  • Mortgage foreclosure process: both — foreclosure by advertisement (non-judicial, MCL 600.3201 et seq.) is the dominant path; judicial foreclosure (MCL 600.3101 et seq.) is also available.
  • Selling authority: county treasurer as FGU (the State of Michigan/DNR is the FGU for counties that have not elected to foreclose themselves)
  • Statutory home: General Property Tax Act, 1893 PA 206, MCL 211.1–211.157 — https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-211-78
  • Tyler v. Hennepin compliance: reformed_post_Tyler (and pre-Tyler). Michigan pre-empted the issue: rafaeli-v-oakland-county-2020 (Mich 2020) held surplus retention unconstitutional under Const 1963, art 10, § 2; the Legislature added the MCL 211.78t “remaining proceeds” claim mechanism. The Court of Appeals upheld that structure against facial challenge for sales that generate proceeds (barry-county-treasurer-foreclosure-2024), while the Supreme Court held that where a unit takes the property with no public auction (right of first refusal), 78t does not apply and the Rafaeli takings remedy controls (jackson-v-southfield-nri).

1. Tax Sale Mechanics

  • What is sold: a deed (fee-simple title) to the foreclosed property — not a lien certificate. After judgment vests title in the FGU (MCL 211.78k), the property is sold at public auction (MCL 211.78m). Source: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-211-78m
  • Bidding method: highest bid (deed) at public auction; sale to the person bidding at least the minimum bid, or the highest amount above it (MCL 211.78m(2)).
  • Interest / penalty (delinquency, not “certificate” interest): On forfeiture to the county treasurer (March 1), additional interest at a noncompounded 1/2% per month (6%/yr) is added to the originally-returned delinquent taxes, plus a $175 forfeiture fee (MCL 211.78g). Source: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-211-78g
  • Minimum bid composition: all delinquent taxes, interest, penalties, and fees due, and may include additional FGU expenses (MCL 211.78m(16)(c)).
  • Sale frequency: annual cycle, keyed to the calendar of forfeiture (Mar 1) → judgment (by ~Mar) → redemption cutoff (Mar 31) → auction (summer/fall).
  • Typical month: Auctions run on/after the third Tuesday in July and must conclude before the first Tuesday in November (MCL 211.78m(2)).
  • Venue: both — many counties and the State (DNR) sell online via tax-sale.info; some in person. Source: https://www.michigan.gov/taxes/property/forfeiture-foreclosure/county/auctions
  • Platform vendors: Tax-Sale.info (Title Check, LLC) is the predominant vendor for State-as-FGU counties and many self-foreclosing counties.
  • Right of first refusal (before public auction): the State, then the city/village/township/city authority, then the county, may purchase at the greater of fair market value or minimum bid before the property reaches public auction (MCL 211.78m(1)).
  • Subsequent taxes (“subs”): not applicable in the certificate sense — Michigan is a deed state; the FGU takes title and any post-judgment taxes are the new owner’s responsibility after sale.

2. Right of Redemption → see right-of-redemption

  • Pre-judgment / pre-sale right: YES. Forfeited property may be redeemed by paying the delinquent taxes, interest, penalties, and fees on or before the March 31 immediately succeeding the entry of the judgment of foreclosure under MCL 211.78k (or within 21 days of judgment in a contested case). MCL 211.78g. Source: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-211-78g
  • Post-sale period (tax): NONE. The judgment of foreclosure is final after March 31; title vests absolutely in the FGU and is not subject to redemption after that date (MCL 211.78k(6)). There is no post-auction redemption for tax deeds — the former owner’s only remaining remedy is the surplus / remaining proceeds claim under MCL 211.78t (see Module 3).
  • Who may redeem (pre-cutoff): the owner or any person with a legal interest (e.g., land-contract vendee, mortgagee, lienholder) by paying the redemption amount (MCL 211.78g).
  • Amount formula: delinquent taxes + 1/2%/month additional interest + penalties
    • $175 forfeiture fee + recording/other statutory fees (MCL 211.78g).
  • Premium to certificate holder: N/A (deed state; no certificates).
  • Extinguishment: failure to redeem by March 31 → judgment becomes final; absolute fee-simple title vests in the FGU and all prior interests are extinguished (MCL 211.78k(5)–(6)).
  • Special tolling: see needs_verification (minors/incompetents/SCRA effect on the GPTA redemption cutoff not separately confirmed against a primary source).

3. Surplus / Excess Proceeds → see surplus-funds, third-party-recovery-rules

  • Belongs to: former owner / priority_waterfall. Per Rafaeli, surplus beyond taxes, interest, penalties, and fees is the former interest-holder’s property; MCL 211.78t allocates “remaining proceeds” by relative priority of claimants’ pre-foreclosure interests. Source: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-211-78t
  • “Remaining proceeds” defined: sale price minus (minimum bid + FGU expenses not in the minimum bid + a statutory sale commission) (MCL 211.78t).
  • Claim waterfall: the circuit court determines the relative priority and value of each claimant’s interest in the property immediately before foreclosure, and allocates remaining proceeds accordingly, without unjustly enriching a claimant at the public’s expense (MCL 211.78t(9)).
  • Filing venue: the circuit court in the same in-rem proceeding in which the judgment of foreclosure was entered under MCL 211.78k (motion practice).
  • Claim deadline — TWO firm steps (MCL 211.78t):
    1. Notice of Intention to Claim Interest (Michigan Treasury Form 5743), signed and notarized, delivered to the FGU by July 1 immediately following the effective date of the foreclosure (MCL 211.78t(2)).
    2. Motion in the foreclosure proceeding filed during the window beginning February 1 immediately succeeding the sale/transfer under MCL 211.78m and ending the following May 15 (MCL 211.78t(4)). This Feb 1–May 15 window is the currently-effective deadline (verified 2026-06-01 against the statute text and enforced in barry-county-treasurer-foreclosure-2024; older secondary sources citing an “October 1” date are stale). Source: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-211-78t Missing either deadline precludes recovery (MCL 211.78t(2),(4)).
  • Escheat / forfeiture of claim: if no Notice of Intention is timely filed, the former owner forfeits any claim to remaining proceeds and the FGU retains them. (No separate escheat-to-unclaimed-property step; the failure-to-file is itself the bar — see needs_verification for confirmation of where unclaimed remaining proceeds ultimately go.)
  • Documentation required: notarized Form 5743 Notice of Intention; then a motion with proof of the pre-foreclosure legal interest and its value/priority (MCL 211.78t).
  • Exclusive mechanism: MCL 211.78t is “the exclusive mechanism for a claimant to claim and receive any applicable remaining proceeds under the laws of this state” (MCL 211.78t(11)).
  • Third-party recovery (recovery agents):
    • fee_cap_pct: none specifically set within MCL 211.78t for tax-foreclosure remaining proceeds — see needs_verification. (Michigan’s general unclaimed-property “finder” cap of 10% under the Uniform Unclaimed Property Act, MCL 567.265, does not by its terms govern the 78t court process.)
    • licensing_required: see needs_verification.
    • assignment_of_claim_allowed: the 78t process turns on a claimant’s legal interest immediately before foreclosure; whether a post-foreclosure assignee of that interest qualifies as a “claimant” is contested — see needs_verification.
    • cooling_off_period / contract_disclosure_rules / prohibited_practices: not found in a 78t-specific primary source — see needs_verification.
    • citation: MCL 211.78t (https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-211-78t)
  • Notice to former owner required: YES — the FGU must notify former owners of the remaining-proceeds claim process (the 78t scheme is built on a Notice-of-Intention regime predicated on owners being informed); confirm the precise notice subsection in needs_verification.

4. Mortgage Foreclosure

  • Process: both, with foreclosure by advertisement (non-judicial, MCL 600.3201–600.3285) the standard route; judicial foreclosure also available. Source: https://www.legislature.mi.gov/Laws/MCL?objectName=MCL-600-3204
  • Conditions to foreclose by advertisement (MCL 600.3204): default; no pending suit on the debt; mortgage (and assignments) recorded; record chain of title to the foreclosing party before sale.
  • Timeline (approx.): notice of sale published once a week for 4 successive weeks and posted on the property; sale by the sheriff (MCL 600.3208, 600.3212). Specific day-counts confirmed: 4-week publication; redemption runs from sale.
  • Reinstatement right: Michigan provides a pre-sale notice/counseling and loan-modification conference regime for residential mortgages (MCL 600.3205a et seq.) — see needs_verification for exact current reinstatement mechanics.
  • Redemption after sale (MCL 600.3240):
    • Residential ≤4 units, debt >66⅔% of original: 6 months from sale.
    • Residential where debt ≤66⅔% of original: 1 year from sale.
    • Commercial/industrial/multifamily >4 units: 6 months.
    • Agricultural: 1 year.
    • Abandoned property: 1 month / 30 days (shortened, MCL 600.3240(9)–(10), 600.3241/3241a).
    • Amount: the bid for the premises + interest at the mortgage rate from sale + sheriff’s fee + a $5 register-of-deeds fee + statutory add-ons (taxes, senior-lien redemptions, insurance) (MCL 600.3240(2),(4)). Source: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-600-3240
  • Deficiency judgment: allowed, with a fair-value defense/offset (MCL 600.3280): in a deficiency action where the mortgagee bought at the sale, the defendant may show the property was “fairly worth the amount of the debt” or that the bid was “substantially less than its true value,” offsetting the deficiency up to the amount of the plaintiff’s claim. Source: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-600-3280
  • Surplus distribution (MCL 600.3252): surplus after the sale and costs is paid to subsequent mortgagees/lienholders by priority, then to the mortgagor, the mortgagor’s representatives, or assigns; junior claimants may file to claim. Source: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-600-3252
  • Sale officer: sheriff (foreclosure by advertisement).

5. Sale Procedure Playbooks

  • Treasurer / FGU tax sale — ordered steps → see treasurer-sale
    1. Taxes returned delinquent March 1 of year +1 (after the prior tax year).
    2. Forfeiture to county treasurer the following March 1 (one year later); $175 fee + 1/2%/month interest added (MCL 211.78g).
    3. FGU petitions circuit court; in-rem judgment of foreclosure entered (~late Feb/March of year +3) (MCL 211.78h, 211.78k).
    4. Redemption cutoff: March 31 after judgment (21 days if contested) (MCL 211.78g/k).
    5. Absolute fee-simple title vests in the FGU; prior interests extinguished (MCL 211.78k(5)–(6)).
    6. Right of first refusal window (State → local unit → county), through ~first Tuesday in July (MCL 211.78m(1)).
    7. Public auction, third Tuesday in July through before first Tuesday in November; sale to highest bidder ≥ minimum bid; fee-simple deed issued (MCL 211.78m(2)).
    8. Former interest-holders pursue remaining proceeds via MCL 211.78t.
  • Sheriff sale (mortgage) — ordered steps → see sheriff-sale
    1. Default + power-of-sale; verify MCL 600.3204 conditions.
    2. Publish notice once/week for 4 successive weeks + post on property (MCL 600.3208, 600.3212).
    3. Sheriff’s sale at public venue to highest bidder; sheriff’s deed delivered.
    4. Redemption period runs from sale date (6 months typical residential; 1 yr agricultural; shortened if abandoned) (MCL 600.3240).
    5. Surplus distributed per MCL 600.3252; deficiency action with fair-value defense per MCL 600.3280.
  • Notice requirements:
    • Tax: published notice ≥30 days before the sale of the time/location (MCL 211.78m(2)); statutory mailed/posted/visited notice of the foreclosure proceedings (MCL 211.78i) with constitutional follow-up duty per Sidun.
    • Mortgage: 4 successive weekly publications + posting (MCL 600.3208, 600.3212). Source: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-211-78m
  • Upset bid / confirmation: none (no upset-bid or judicial-confirmation step for either tax auctions or foreclosure-by-advertisement sheriff sales). Finality comes from the March 31 cutoff (tax) or expiry of the redemption period (mortgage).
  • Payment terms: tax-sale.info auctions require deposit/registration and prompt payment of the balance (county/vendor-specific). Confirm per county.
  • Deed issued: tax sale → fee-simple deed from the FGU (no warranty of title beyond the statutory conveyance), vesting “fee simple title” (MCL 211.78m(2)); mortgage → sheriff’s deed, becoming absolute on expiry of redemption.

6. Due Process & Notice → see due-process-notice

  • Standard: notice “reasonably calculated, under all the circumstances,” to apprise interested parties — Mullane, applied to GPTA tax foreclosure; when a mailed notice is returned undelivered, the State must take additional reasonable steps (jones-v-flowers), as Michigan applied in sidun-v-wayne-county-treasurer-2008.
  • Required attempts (GPTA, MCL 211.78i): title search to identify owners/interest holders; certified mail; publication; personal visit/posting on occupied property; plus reasonable follow-up if mail is returned (constitutional overlay from Sidun).
  • Consequence of defective notice: voidable — defective notice can support setting aside the foreclosure judgment as to the affected party (per Sidun remand for further proceedings); after the March 31 finality date the statute sharply limits collateral attack, so timing and the constitutional notice defect matter.
  • Leading cases: sidun-v-wayne-county-treasurer-2008, jones-v-flowers, mennonite-v-adams, rafaeli-v-oakland-county-2020.

7. Title & Marketability

  • Deed warranty level: statutory conveyance vesting fee-simple (no general warranty); effectively a tax/quitclaim-type title for marketability purposes.
  • Marketable immediately? Often not without curative work — title insurers typically require time and/or a quiet-title action before insuring a tax-deed title; see needs_verification for a primary citation on insurer practice.
  • Quiet title required? Commonly recommended/needed to obtain insurable, marketable title after a tax-deed purchase (practice norm; not a statutory mandate) — see needs_verification.
  • SOL to challenge the deed: the GPTA makes the foreclosure judgment final after the March 31 cutoff and limits modification/invalidation (MCL 211.78k(6)); narrow exceptions exist (e.g., constitutional notice failures). Precise limitation period for collateral attack → see needs_verification.
  • Title insurance availability: generally available after curative steps/quiet title; see needs_verification.
  • Common defects: notice defects (Sidun-type), unextinguished federal interests (IRS 120-day redemption), bankruptcy-stay violations, heirs/estate interests, surplus-claimant disputes.

8. Case Law (real, verified)

CaseYearTopicHolding (plain English)Source
rafaeli-v-oakland-county-2020 (505 Mich 429; 952 NW2d 434)2020surplusRetaining tax-foreclosure proceeds above the tax debt is an unconstitutional taking under Const 1963 art 10 §2; former owner has a property right to the surplus.https://www.courts.michigan.gov/siteassets/case-documents/uploads/OPINIONS/FINAL/SCT/156849_143_01.pdf
tyler-v-hennepin-county (598 US 631)2023surplus / due_processFederal Fifth Amendment Takings Clause bars a government from keeping the surplus equity above the tax debt; aligns federal law with Rafaeli.https://www.supremecourt.gov/opinions/22pdf/22-166_8n59.pdf
sidun-v-wayne-county-treasurer-2008 (481 Mich 503; 751 NW2d 453)2008due_processTreasurer’s notice of GPTA foreclosure was constitutionally inadequate; after returned/ineffective notice the State must take reasonable additional steps (applying Jones v. Flowers).https://caselaw.findlaw.com/mi-supreme-court/1442630.html
jackson-v-southfield-nri (Mich Sup Ct, Docket 166320; COA Docket 361397) — reporter cite not yet confirmed, see needs_verification2025 (MSC); 2024 (COA)surplus / sale_procedureWhere the foreclosing unit (or a local unit via right of first refusal) takes the property at the minimum bid with no public auction, MCL 211.78t does not supply the surplus remedy — the statute is built around a sale/transfer that generates “remaining proceeds.” A government cannot avoid a Rafaeli taking by transferring the property to a proxy (here, a nonprofit revitalization entity) instead of selling it; the former owner’s remedy for the retained equity above the tax debt lies in inverse-condemnation / takings litigation under Rafaeli.https://www.courts.michigan.gov/4aa515/siteassets/case-documents/uploads/opinions/final/sct/166320_105_01.pdf
barry-county-treasurer-foreclosure-2024 (In re Petition of Barry County Treasurer for Foreclosure, Mich Ct App, published, Docket 362316)2024surplus / sale_procedureFor tax foreclosures that do proceed to sale, MCL 211.78t is the exclusive mechanism by which a former owner claims surplus “remaining proceeds,” and the statutory process is facially constitutional — it does not effect an unconstitutional taking under the Michigan or U.S. Constitutions and its July 1 Notice-of-Intention and motion deadlines are enforceable.https://www.mikameyers.com/michigan-court-of-appeals-concludes-that-statutory-process-to-claim-surplus-proceeds-resulting-from-tax-foreclosure-is-not-unconstitutional/

(Sale-procedure topic is also covered by the MCL 211.78m / 600.3252 statutory analysis above. Note the division of labor between the two surplus cases: barry-county-treasurer-foreclosure-2024 holds 78t is the exclusive, facially constitutional remedy when a sale generates remaining proceeds, while jackson-v-southfield-nri holds that when there is no public auction (a right-of-first-refusal/minimum-bid transfer), 78t does not govern and the former owner pursues the retained equity through inverse-condemnation / Rafaeli takings.)

9. Edge Cases (state-specific notes)

  • bankruptcy-automatic-stay — A Chapter 13 filing before the March 31 redemption cutoff can preserve the right to cure delinquent property taxes through a plan; a petition filed after title vests in the FGU generally cannot undo the completed foreclosure. (Confirm controlling authority — see needs_verification.)
  • federal-tax-lien-redemption — The IRS retains a 120-day right of redemption (26 USC 7425) after a sale that discharges a junior federal tax lien; purchasers of Michigan tax deeds and sheriff’s deeds take subject to that federal window.
  • heirs-property — Estate/heir interests are recurring 78t surplus-claim disputes; heirs of a deceased former owner asserting “remaining proceeds” must establish a qualifying legal interest immediately before foreclosure (litigated under 78t).
  • manufactured-homes — Treatment depends on whether the home is affixed/taxed as realty vs. titled as personalty — see needs_verification.
  • scra-protections — Servicemembers Civil Relief Act may toll/limit mortgage foreclosure and affect redemption; interaction with the GPTA March 31 cutoff not separately confirmed — see needs_verification.
  • void-vs-voidable — Notice-defective GPTA foreclosures are treated as voidable and attackable on due-process grounds (Sidun); the statute otherwise enforces strict finality after March 31.

10. Operations

11. Meta

Legal information, not legal advice. This page summarizes Michigan tax- and mortgage-foreclosure law from primary sources retrieved on 2026-06-01. Statutes and case law change; verify against the cited primary sources and consult a licensed Michigan attorney before acting.

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