Now Accepting New Clients!

REAL ESTATE 34: Petitioners file claim for overbid proceeds after sheriff’s sale.

This case arises out of the sheriff’s sale of property in Southfield, Michigan. The record reflects that in 2008 the Petitioners obtained a $227,360 loan secured by a mortgage against the Southfield property. Subsequently, in 2013, they filed for Chapter 7 bankruptcy protection; the bankruptcy discharge extinguished their financial obligations under the promissory note, but did not extinguish Bank of America’s security interest, i.e., mortgage on the Southfield property. In 2017, Bank of America initiated a foreclosure by advertisement on the property.

There appears to be some dispute as to the outstanding balance on the mortgage: Petitioners contend that the balance was $184,413.26, whereas Bank of America asserts that it was $185,002.71, exclusive of foreclosure costs and legal fees. Regardless, at the sheriff’s sale, Bank of America made a partial credit bid of either $100,000 or $102,750, but a third-party purchaser bid and paid $141,750 for the property.

Thereafter, the Petitioners filed a claim for overbid proceeds with the Oakland County Sheriff’s Department, contending that there was a surplus as a result of the sale. In September 2017, the Petitioners filed a complaint in circuit court seeking the alleged surplus money from the sheriff’s sale. In October 2017, the Petitioners filed a motion to compel the release of the surplus money. In doing so, they argued that because their financial obligation under the promissory note secured by the mortgage on the property was discharged in bankruptcy, the difference between Bank of America’s partial credit bid and the final bid on the property constituted surplus money under MCL 600.3252 to which they, not Bank of America, were entitled to receive.

In response, Bank of America argued that the mortgage was not satisfied by its partial credit bid, so MCL 600.3252 was inapplicable. Additionally, Bank of America pointed out that because the amount owed was $185,002.71 and the property only sold for $141,750, there was a deficiency, not a surplus. The trial court agreed with Bank of America, denied the Petitioners’ motion, and dismissed the complaint.

The statute only applies to any surplus money after satisfying the mortgage on which the real estate was sold. Therefore, for the Petitioners to be entitled to anything under MCL 600.3252, the mortgage on the Southfield property must have been satisfied and there must be surplus money remaining after the mortgage is satisfied. Neither requirement is met in this case.

Here, the amount due and owing on the mortgage was either $184,413.26 or $185,002.71. Therefore, in order to meet the financial obligation under the mortgage, the property had to sell for either $184,413.26 or $185,002.71. It was only sold, however, for $141,750. As a result, the mortgage was not satisfied by the sheriff’s sale.

Whether you are trying to save your home from foreclosure, or your home loan is upside down and you are unsure of what you should do, you can find the sound advice and helpful support you require at Aldrich Legal Services in Plymouth, Michigan. We have helped many people find solutions to the real estate issues that you now face. Contact us today to schedule a free consultation and learn more about options that may be available to you.

Contact Aldrich Legal Services

FAMILY LAW 50: A Michigan Court has jurisdiction to make an initial custody determination when it is the home state of the child on the date of the commencement of the proceeding or within 6 months before the commencement of the proceeding.

PROCEDURAL HISTORY  Plaintiff and defendant have twin sons, but never married.  On August 13, 2008, the Court of Common Pleas Juvenile Division in Montgomery County, Ohio established plaintiff as the legal father of the children and...

When You Should Contest a Will?

Wills usually go through without a problem. Well over 90% of wills have no issue making it through probate. However, there are several grounds you may have to contest a will. As a beneficiary, or someone who would gain from a will, there are legal...

What You Need to Know About Distracted Driving

A great U.S. freedom is the ability to drive the open roads. However, every year there are more than 20,000 car accidents in Michigan. Many of these accidents come from distracted driving and could have been avoided. Distracted driving is such a...

Reasons Your Will or Trust Could be Contested

Everyone reacts in their own way when a family member passes away. Emotions can run high, and people can react more strongly than they normally would. Some family members may feel cheated by what a will or trust grants them leading them to contest...

Penalties For Driving Without Insurance in Michigan

Getting into a car and going for a drive isn’t perfectly safe. Driving on the Michigan roads can be dangerous. Driving those same roads becomes financially dangerous if you drive without car insurance. Between fees, charges, and possible...

PROBATE 36: Undue influence to execute Lady Bird deed.

This probate dispute between siblings arises out of the death of their father. Their father lived alone. In 2013, however, he asked appellee to live with him. She agreed, moving into the home in August 2013. Appellants allege that in the years...

Top 5 Most Common Traffic Violations in Michigan

Staying safe on the roads is in everyone’s best interest. However, keeping yourself or others out of danger is everyone’s responsibility. Getting a traffic ticket ends up costing drivers big time. Traffic tickets and citations cost money...

Don't let a bad decision, unfair contract, or a messy divorce get in the way of a promising future!
Contact the experienced team at Aldrich Legal Services today to schedule your free initial
and secure reliable and trustworthy representation today!
Get the Help You Need From a Team You Can Truly Count On: (734) 404-3000