Former Wayne County property owners whose homes were foreclosed upon and sold at auction can claim the profit that the county made on the sale, but they must do so by March 31.
That profit is the money from the property sale minus the taxes and fees owed to the county that prompted the foreclosure. The Michigan Supreme Court, in a 2020 ruling, decided that former property owners are entitled to the windfall from tax foreclosure sales. In Oakland County, former property owners sued after the county foreclosed and sold their properties, making thousands more than what they owed in taxes and fees.
In one case, a former property owner owed $285 and the county sold the property at public auction for $24,500. In the other, another person owed $6,000 in taxes and the county sold the property for $82,000. The cases prompted similar lawsuits seeking to recover surplus proceeds for former property owners. Last year, the state supreme court clarified its 2020 ruling, saying it is retroactive, meaning owners of properties that were foreclosed before 2020 may make a claim for the remaining funds on the sale of their former property.
About 5,600 properties may be eligible for surplus proceeds from auction sales that took place prior to 2020, according to Adam Abusalah, communications director for the Wayne County Treasurer’s Office. Here’s more information for Wayne County residents who want to claim leftover money on their former, foreclosed property:
How can former owners file a claim for proceeds from sales before 2020?
Former owners whose properties were sold at auctions in Wayne County before Dec. 22, 2020 must file a claim by March 31, 2025. Here are the steps:
- Fill out a notice of intention form from the Michigan Dept. of Treasury. Here is the form: bit.ly/NoticeofIntentionForm
- Have the form notarized.
- Submit the completed form to the Wayne County Treasurer’s Office through certified mail or by dropping it off in person at: 400 Monroe St., Detroit, MI 48226.
The form notes that completing the paperwork is evidence of an “intent to make a future claim but is not itself a claim for sales proceeds.” That’s essentially the first step.
What happens after filing a claim?
After claimants fill out and submit the form, foreclosing governmental units − in this case the Wayne County Treasurer’s Office − will send out notices with information about whether there is leftover money, if anyone else has made a claim, notification that the claimant has to file a motion and information on the circuit court where that motion must be filed, according to the nonprofit Michigan Legal Help, which is funded in part by the Michigan Supreme Court.
The Wayne County Treasurer’s Office will provide that notice by July 1. Claimants must then file a motion with the circuit court by Oct. 1, essentially asking the court for surplus dollars from the foreclosure sale, and go to a hearing before a judge prior to getting any leftover dollars.
What about property foreclosed after Dec. 22, 2020?
Former property owners looking to make claims on leftover proceeds from foreclosure sales after December 2020 can complete and return a notarized form, via certified mail or in person, by July 1 the year of the foreclosure.
Where will the money come from?
According to Abusalah, the money to pay former property owners who make claims for the windfall from auctions are “unclaimed proceeds from the sales of foreclosed properties and interest charges on delinquencies. Portions of what would have been surplus funds going to the general operating fund over the past five years have been reserved to pay claims.”
Where can former Wayne County property owners go for more help?
For more information, the Wayne County Treasurer’s Office is directing interested claimants to the following website and phone number: WayneCountyForeclosureClaims.com and 833-421-8123. That website links to a list of auction sales from 2015 to 2020 “likely subject to proceeds claims,” including the foreclosed year, property address and sale amount. View it here: bit.ly/WayneCountyAuctionSales
Outlier Media and partnering nonprofits are helping Detroiters get money they may be owed from past tax foreclosures. For more information and help, go to outliermedia.org/txt-outlier/repay/ or text REPAY to 67485, the newsroom’s free text message service where a reporter can help residents. Message and data rates may apply.
Wayne County Treasurer Eric Sabree also recorded a video explaining the process of making claims. Watch it here: bit.ly/EricSabreeSurplusProceeds
For more information about the claims process go to Michigan Legal Help at bit.ly/MichiganLegalHelpSurplus and the Michigan Dept. of Treasury at bit.ly/MichiganTaxpayerResources. Read the law here: bit.ly/MichiganLawClaimsProcess.