Why So few Northville foreclosures

A client recently asked me where have all the Northville foreclosures gone?  There are less and less of them each year.  The first reason is that Northville home owners are a different demographic than say Detroit home owners.  They have higher incomes, more educated, and less likely to be laid off their higher paying jobs.  A larger percentage of Northville home owners are less likely to lose their home than Detroit home owners would.  There are so few foreclosures of them, yet the banks and the media says there is a shadow inventory of them.  They keep saying there is going to be another wave of Northville foreclosures coming to market, but  you are not seeing any more of them.  Part of it is that there are less home owners losing their homes.

Zillow and other websites have the home listed as a foreclosure but it never shows up for sale.  What is going on with these homes?  Let's address the issue of Zillow or other internet sites saying the home is foreclosed on.  Some websites have the ability to identify when a home is three or more months behind in their payments.  That constitutes a foreclosure but the bank may have not actually started the foreclosure.  Zillow, I believe pulls their information from public records.  So they know that the bank has taken action by doing a sheriff sale on the house.

What you have to understand is that in Michigan, just because the bank has foreclosed on the property it is still not the banks property.  In Michigan, the home owner has six months to redeem the property.  They have six months to come up with the money and pay back the amount of sheriff sale plus interest.  So that White Lake home cannot be sold until the six months is over.  It may be redeemed and the owner may still own the home.  So even if it is foreclosed it may never hit the real estate market.

The other reason you may never see it as a foreclosure is that many investors are out there buying these Northville homes that have been foreclosed on.  They come in with cash and buy these homes at sheriff sale if they are a bargain.  Then these investors fix them up and put them up on the market after the six months is up.  They can't even start working on them until after the six months because they do not own it.  So it could be anywhere from 8 months to over a year from now before any of these White Lake homes come to market.

Last but not least some banks are taking years to foreclose on home.  Yes I said years.  I know a home owner that was in their house 3 years without making a payment on their home.  They could have gone for longer but they found another house to live in.  Another person that I know that lives on my street hasn't made a house payment in two years and the bank still hasn't kicked them out.  Sometimes the bank takes so long because they do not want the negative publicity.  One of the people I talked about above was a 65 year old person that got cancer and lost their business.  No bank wants to kick out an sick, elderly person on social security out of their house.  It is just bad business.

So there are a few a few examples of where all the Northville foreclosures have gone.  If you would like more information on Northville real estate or  lakefront foreclosures Oakland County Michigan