Massive Discounts on Michigan Properties Through Tax Deed Sales!

Sale Details

Michigan Tax Deed – The auctions typically happen in the summer and fall, but the exact dates can vary depending on the county.

Redemption Period

There’s no redemption period. Once you win the auction, you own the property.

Bid Procedure

premium bid/ sold to the highest bidder

Number of Counties: 83

Useful Links

Official Michigan Tax Sale Website
Property Tax Forfeiture and Foreclosure
Auctions and Claimants

Investing in Michigan tax deed sales offers a powerful opportunity for real estate investors. You can purchase properties for a fraction of their market value, sometimes for as much as 90% off. Unlike tax lien states, Michigan’s tax deed auctions transfer full ownership of the property immediately after the sale, making it a unique and attractive option for both beginner and seasoned investors.

This guide covers essential information about how Michigan tax deed sales work, details of the auction process, and key strategies to secure the best property deals. With 83 counties in Michigan offering tax deed properties, there are many opportunities for savvy buyers.

What Are Michigan Tax Deed Sales?

Michigan tax deed sales occur when property owners default on their property taxes, prompting the county to auction off the property to recover unpaid taxes. In Michigan, these auctions are known as tax deed sales because they transfer full ownership through a quitclaim deed to the buyer, with no waiting period or redemption window.

This is distinct from states that sell tax liens, where the investor acquires the right to collect unpaid taxes rather than full property ownership. With Michigan’s tax deed system, you immediately become the property owner after a successful bid.

Important Details About Michigan Tax Deed Sales

Key Auction Details

Online Auctions
All auctions in Michigan are conducted online, making it convenient for out-of-state investors to participate. The bidding process is simple, and the highest bid at the end of the auction secures the property.

Timing of Auctions
Michigan’s tax deed auctions typically take place in summer and fall, though specific dates vary by county. You must put a $1,000 hold on your credit card to place a bid. This is not an actual charge unless you win the auction and then fail to pay. Be sure to check the auction schedule for the county you’re interested in.

No Redemption Period
Once the auction is complete, there’s no redemption period. You take full ownership of the property immediately after winning the auction. This is a major advantage over other states where the property owner may have time to reclaim their property by paying back taxes.

How the Auction Process Works

Auction Process Breakdown

Michigan’s tax auctions are divided into two main phases:

1. Advance Bidding
   • Advance bidding opens 30 days before the auction date. During this time, you can place bids and adjust them as needed. However, you won’t be able to see competing bids, it’s a bit of a guessing game, so your strategy should be based on careful property evaluation.
2. Active Bidding
   • On the auction day, live bidding starts at 10:00 a.m. and ends at 7:00 p.m. During this phase, you can see the highest bid and place your own bid accordingly. Once a bid is placed during active bidding, it cannot be withdrawn.
3. Payment Details
   • If you win, you’ll receive an email with payment instructions. The final price includes the winning bid amount, a 10% buyer’s premium, any unpaid current-year taxes, and a $30 recording fee.

Key Auction Details

1. Timing of Auctions
   Michigan’s tax deed auctions typically take place in summer and fall, though specific dates vary by county. Be sure to check the auction schedule for the county you’re interested in.
2. No Redemption Period
   Once the auction is complete, there’s no redemption period. You take full ownership of the property immediately after winning the auction. This is a major advantage over other states where the property owner may have time to reclaim their property by paying back taxes.
3. Online Auctions
   All auctions in Michigan are conducted online, making it convenient for out-of-state investors to participate. The bidding process is simple, and the highest bid at the end of the auction secures the property.

Auction Process Breakdown

Advance Bidding
Advance bidding opens 30 days before the auction date. During this time, you can place bids and adjust them as needed. However, you won’t be able to see competing bids, so your strategy should be based on careful property evaluation.

Active Bidding
On the auction day, live bidding starts at 10:00 a.m. and ends at 7:00 p.m. During this phase, you can see the highest bid and place your own bid accordingly. Once a bid is placed during active bidding, it cannot be withdrawn.

Payment Details
If you win, you’ll receive an email with payment instructions. The final price includes the winning bid amount, a 10% buyer’s premium, any unpaid current-year taxes, and a $30 recording fee.

Types of Michigan Tax Auctions

1. Minimum Bid Auctions
   • These auctions start with a minimum bid that includes the back taxes, penalties, and fees. You must bid at least this amount. Winning bids at these auctions transfer full ownership, but you may still need to pay current taxes.
2. No-Reserve Auctions
   • For properties that don’t sell during minimum bid auctions, the county may hold a no-reserve auction, where properties can sell for as little as $100. These auctions are a great way to pick up properties at a bargain price, but they can be competitive.

What Makes Michigan Tax Sales Attractive?

1. Opportunity to Buy Cheap:
   • Michigan’s no-reserve auctions, where properties can start as low as $100, are a major draw for investors. These sales offer the chance to purchase real estate for a fraction of its market value.
2. Ease of Participation:
   • Since all auctions are conducted online, you don’t need to be physically present to bid. This opens up opportunities for investors from all over the country, or even from abroad, to participate in Michigan’s tax sales.
3. Full Ownership Transfer:
   • When you win a property, you receive a quitclaim deed, which means you own the property outright. Unlike tax lien states where you might have to wait years to get the property, in Michigan, ownership transfers immediately.
4. Low Entry Barriers:
   • The $1,000 hold on your credit card is relatively low compared to the potential return on investment. This makes it easier for new investors to get started.

Things to Look Out for When Buying Michigan Tax Deeds

While Michigan tax sales can be a great investment, there are a few things to be aware of:

1. Do Your Homework:
   • Before bidding, research the property thoroughly. This includes checking out the property in person if possible, reviewing county records for any liens or other issues, and considering the condition of the property. Remember, properties are sold “as-is,” so you’re responsible for any repairs or legal issues after purchase.
2. Occupied Properties:
   • Some properties might still have occupants living in them. If you buy an occupied property, you’ll need to go through the legal process to evict the tenants. This can be time-consuming and costly, so it’s important to factor this into your decision.
3. Surviving Liens:
   • Most liens are cleared during the tax sale process, but some, like IRS liens or certain environmental liens, might remain. You should check for any surviving liens before you bid, as they could affect the value of your investment.
4. Title Insurance:
   • Getting title insurance on tax deed properties can be challenging. It’s a good idea to talk to an experienced title insurance agent before you bid, so you know what to expect.
5. No Refunds:
   • All sales are final. If you win a property, you can’t back out or get a refund. Ensure you fully commit before placing your bid.

Michigan Tax Deeds Frequently Asked Questions (FAQs)

Q: Can I participate in Michigan tax sales if I’m not from Michigan? A: Yes, anyone can participate in Michigan’s online tax sales, even if you live in another state or country.

Q: What happens if I win multiple properties? A: If you win more than one property, you must buy all of them. You can’t choose to buy only some of the properties after the auction ends.

Q: Are there extra costs I need to pay if I win? A: Yes, in addition to your winning bid, you’ll need to pay a 10% buyer’s premium, any current year’s taxes, and a $30 deed recording fee.

Q: Is it easy to get title insurance for a tax-sale property? A: Not always. Title insurance for tax sale properties can be tricky, so it’s important to work with an experienced agent who understands the process.

Q: How long does it take to get the deed? A: It usually takes about 6-8 weeks for the deed to process and mailed to you after the auction.

Conclusion

Michigan tax sales offer a unique opportunity to invest in real estate at a low cost. With the potential to buy properties at no-reserve auctions for as little as $100 and the convenience of online bidding, it’s an option worth considering for both new and experienced investors. Make sure to research, understand the risks, and prepare for the responsibilities of property ownership.

Need Help or Have Questions?

• Learn More: Download our FREE ABCs of Tax Liens and Deeds
• Book a Consultation: If you’re unsure where to start or need expert advice, book a consultation call with Dustin Hahn today.