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After the motgage debt has been dicharged in Bankruptcy and the sheriff sale has occurred, can I still redeem by refi. with bank

Petoskey, MI |

I am in redemption period. Will the bank who was buyer at Sheriff sale still consider renegotiating a different mortgage amount with me and lower monthly payment based on current market value and my income/expense situation?

Attorney Answers 2


It seems doubtful that a mortgage lender who has a buyer would renegotiate. Unless your offer to repay is considerably better than what you sold it for. However, this is a situation where it never hurts to ask. Since the bankruptcy has already discharged the debt asking them for a new mortgage payment cannot hurt you. Only signing a new mortgage contract and then failing to pay could be bad because your new mortgage would not be discharged.

These statements do not constitute legal advice. They are meant to be general in nature, for any specific legal questions you should always seek the counsel of an experienced attorney.

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Once the sale has occurred, your right to redemption means you have to pay what was bid at the foreclosure sale. You have no right to reinstate the loan. You could propose to pay less, and if the lender accepted, you would have to come up with the money, usually by finding another lender willing to finance the redemption. Most lenders are constrained from doing anything that seems logical to you by their lending/foreclosure guidelines. Most also have some type of insurance to protect them from losses, but they have to do things by the book in order to collect. Unfortunately, current market value and/or our financial circumstances have nothing to do with their decision making process.

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