Lawsuits claim Michigan foreclosure practices unconstitutional

Jan 7, 2019

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Counties across Michigan are being sued over a common foreclosure practice. When a foreclosed home is auctioned by the county, they keep the profits.

The Wexford County Treasurer's Office says that money then goes in a general fund that they use at their discretion.

Attorney Phillip Ellison of Outside Legal Counsel says that’s unconstitutional.

“They keep everything, and they don’t refund any difference back to the homeowner even though the debt is a mere fraction of the value of the asset that they took,” Ellison says.

Ellison and his team have filed lawsuits against 59 Michigan counties so far for this practice. They want it to stop, and they want counties to reimburse affected homeowners.

Lake, Osceola, Wexford and Missaukee counties were the latest to get sued last month. Ellison says they plan to file suits against at least 90 percent of Michigan’s counties.

The Michigan Supreme Court is currently hearing a case on a similar dispute in Oakland County. Ellison says they’re waiting for the decision in that case before proceeding. A decision is expected this year.