My question involves a mortgage in the state of: Michigan
Hello I live in Michigan and have recently purchased a house, which I intend to live in, at a sheriff's sale. The home I purchased had two mortgages on it with two different lenders, both of which were foreclosed. The Senior loan is from 1994 and the balance on it is 79k and the junior loan is from 2001 with a balance of 90k (This was a revolving line of credit). The sheriff sale was for the first mortgage and the lender put in their bid amount and I bid higher and received a sheriff's deed. I know there is a six month redemption period in Michigan, which I do not want to wait for the pass and I fear the house may be torn to shreds by that time. I contacted the current owner who is still living in the home and offered her 5k to sign a quitclaim deed and vacate the premises, to which they agreed. The sale went over the first lenders opening bid by 26k. I assume that the 26k will go to the second lender as there are no back taxes or any other liens on the property.
1. The second lender did not attend the sheriff sale nor bid on it. Can they still redeem the property during the 6 month redemption period and who exactly are they redeeming it from if the first lien is paid off and I own the deed?
Also, The second lender filed a law suit against the home owner and the first lender for rights to have position one and the right to foreclose. My lawyer tells me that it makes no sense for them to do this and they are wasting their time.
2. The second lender will be getting roughly 26k from the foreclose so why wouldn't they just take the money and sue for deficiecy or write the rest off? Why would they want to sink in 79k on top of the 90k they are already owed and have to try and sell the home?