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State legal library · MI

Michigan

MCL §§ 600.5701–600.5760; § 565.351 et seq.; § 600.3101 et seq.

Contract type

Land contract

Cure period

15 days statutory

Recording

Recommended

Register of Deeds

Default remedy

Forfeiture or judicial foreclosure

Owner-Finance Land Contracts in Michigan

Overview

Michigan has one of the most active land-contract markets in the country, particularly for recreational, "Up-North," and rural parcels. A Michigan land contract is an installment sale of real estate in which the buyer takes possession and equitable title and pays the seller over time; the seller retains legal title until the buyer pays in full.

Governing Law

The forfeiture procedure is governed by MCL §§ 600.5701–600.5760, which establish notice, service, cure, and summary-proceedings mechanics. Recording of land contracts is governed by MCL § 565.351 et seq. Judicial foreclosure follows MCL § 600.3101 et seq.; non-judicial foreclosure by advertisement is governed by MCL § 600.3201 et seq. The statute of frauds (MCL § 566.106) requires real-estate sale agreements to be in writing.

Recording the Buyer's Interest

Recording is permitted but not required. Buyers should record either the full contract or a memorandum at the Register of Deeds in the county where the parcel sits. Many sellers prefer recording a memorandum to keep financial terms confidential.

Default and Cure Period

MCL § 600.5728 requires the seller to serve a written notice of forfeiture specifying the default and giving the buyer time to cure. For monetary defaults, the cure period is generally 15 days from service; longer periods apply to certain non-monetary defaults. If the buyer cures within the cure period, the contract is reinstated.

Seller Remedies on Default

Two principal remedies. Statutory forfeiture is the fastest path: serve the § 600.5728 notice, wait the cure period, and — if uncured — file a summary-proceedings complaint in district court for a judgment of possession. Even after judgment, Michigan law gives the buyer a redemption window (often 90 days) during which the buyer can redeem by paying the judgment amount; this is a Michigan-specific protection.

Alternatively, the seller may pursue judicial foreclosure, which produces a sheriff's sale and a money judgment for any deficiency. Mature contracts with substantial buyer equity may be recharacterized as mortgages, requiring foreclosure rather than forfeiture.

Vacant Land vs. Residential

Michigan's land-contract framework applies uniformly to residential, commercial, and vacant-land transactions. Vacant-land Michigan land contracts — particularly Up-North recreational tracts — are extremely common.

Practical Notes for Sellers

  • Compliance with statutory forfeiture procedures is essential. Defective notice is the most common mistake.
  • Track payments meticulously to support the default amount.
  • Serve all parties of interest, including assignees and recorded junior lienholders.
  • Respect the redemption period after judgment of possession.
  • For waterfront or wetland parcels, address EGLE permitting issues explicitly.

Disclaimer

This page is a public-law summary for general informational purposes only. It is not legal advice. Owner-finance transactions are state-specific and fact-specific. Engage a licensed attorney in the parcel's state before drafting, signing, or recording any agreement.

Structured data

The legal mechanics of a Michigan deal.

Governing statute
high confidence
MCL §§ 600.5701–600.5760; § 565.351 et seq.; § 600.3101 et seq.
Michigan has a robust statutory framework for land contracts, including a specific forfeiture procedure with mandatory notice and cure.
Recording instrument
Land contract or memorandum of land contract
Filed at the Register of Deeds. Recording is recommended to protect the buyer's interest.
Cure period
15 days (statutory)
MCL § 600.5728 requires written notice; the buyer typically has 15 days to cure a monetary default before summary proceedings.
Default remedy
Forfeiture or judicial foreclosure
Sellers may pursue statutory forfeiture under MCL §§ 600.5701–600.5760 followed by summary proceedings, or judicial foreclosure under § 600.3101 et seq.
Notable requirements
  • Statutory notice of forfeiture (MCL § 600.5728) before summary proceedings
  • Notarization for recording
Prohibited or limited
  • Forfeiture without compliance with statutory notice procedure is unenforceable
  • Buyer's right to redeem after summary-proceedings judgment
Vacant land vs. residential
Michigan land contracts commonly used for vacant-land sales, particularly recreational and Up-North parcels.

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Important disclaimer

This page is a public-law summary for general informational purposes only. It is not legal advice. Owner-finance transactions are state-specific and fact-specific. Engage a licensed attorney in Michigan before drafting, signing, or recording any agreement. Statute citations and procedural notes may be incomplete or out of date — always verify against the current code.