What Happens If You Don’t Pay Property Taxes in Michigan?
A year-by-year look at Michigan’s delinquent property tax process — and how it’s completely different from mortgage foreclosure.
Unpaid property taxes in Michigan trigger a completely different legal process than a missed mortgage payment — one that’s arguably faster and less forgiving. Under the state’s General Property Tax Act, unpaid taxes can lead to losing the property entirely within about three years, regardless of whether the mortgage itself is current. If you’re behind on property taxes and considering your options, Genesee County Home Buyers can make you a fair, no-obligation cash offer at any stage of this process.
The Three-Year Timeline, Explained
| When | What Happens |
|---|---|
| March 1, Year 1 | Unpaid taxes become “delinquent” and are turned over to the county treasurer; a 4% fee and 1% monthly interest begin |
| March 1, Year 2 | Property is forfeited to the county treasurer; a $175 fee is added and interest jumps to 1.5% per month, retroactive to the delinquency date |
| Following months | County files a foreclosure petition in circuit court; title searches and notices are sent to all owners and lienholders |
| January-February, Year 3 | Show-cause hearings are held, giving owners a final chance to object before a circuit court judge signs the foreclosure judgment |
| March 31, Year 3 | Final deadline to pay all back taxes, interest, penalties, and fees — this is called redemption. After this date, all rights to the property are lost |
This timeline and every fee involved is spelled out in detail on the Michigan Department of Treasury’s property tax forfeiture and foreclosure page, which is the most authoritative source for current rates and deadlines statewide.
Forfeiture Is Not the Same as Foreclosure
This is the single most important distinction in the entire process, and it’s one a lot of homeowners misunderstand. Forfeiture (Year 2) means the county has taken a legal claim against the property and increased the interest rate — but you still own the home and still have roughly one more year to pay it off. Foreclosure (Year 3) is final. Once the March 31 redemption deadline passes without payment, ownership transfers to the county or state, full stop, with no further right to redeem.
“People sometimes hear ‘forfeited’ and panic, thinking they’ve already lost the house. Forfeiture just means the clock is now running faster and costing more. You still have real time to fix it at that stage.”
— Genesee County Home Buyers
How This Differs From Mortgage Foreclosure
Mortgage foreclosure and property tax foreclosure are entirely separate legal processes in Michigan, run by different parties under different laws. A mortgage lender forecloses because loan payments are missed; the county treasurer forecloses because taxes are unpaid — and critically, you can be completely current on your mortgage while still losing your home to tax foreclosure, or vice versa. Homeowners dealing with mortgage-side foreclosure should see our guide on avoiding foreclosure in Flint, MI, which covers that separate process in depth.
What Happens to Any Extra Money From the Auction Sale
Once a property is foreclosed, it’s typically sold at a county tax auction. For decades, Michigan counties kept any sale proceeds beyond the tax debt owed — but that changed in 2020. In Rafaeli, LLC v Oakland County, the Michigan Supreme Court ruled that keeping this surplus violates the state constitution’s protection against uncompensated takings, and in 2024 the court confirmed this ruling applies retroactively to past foreclosures too. If your property (or a property you previously owned) was tax-foreclosed and sold for more than what was owed, you may be entitled to claim that surplus. Genesee County’s own treasurer’s office provides the specific claim forms and process for exactly this situation.
Local Genesee County Specifics
Genesee County’s treasurer’s office handles this process locally and publishes its own delinquent tax lists, auction schedules, and FAQ. For a full walkthrough of what this looks like specifically in Genesee County — including local deadlines and how to check your own parcel’s status — see our guide on property tax foreclosure in Genesee County.
If You’re Trying to Sell Instead of Paying Off the Debt
Back taxes don’t necessarily prevent a sale — in many cases, the amount owed can be paid directly from sale proceeds at closing, similar to a mortgage payoff. Our guide on selling a house with back taxes owed in Michigan covers exactly how that works.
Frequently Asked Questions
How many years behind can I be before I actually lose my house?
Roughly three years total — one year of delinquency, followed by a year in forfeiture, followed by foreclosure and a final redemption deadline of March 31 of the third year.
Can I set up a payment plan to catch up?
Yes, many county treasurers offer delinquent tax payment plans; contact your county treasurer’s office directly to ask about current options.
Does paying off my mortgage protect me from tax foreclosure?
No. Property tax foreclosure is entirely separate from your mortgage and can proceed even if your mortgage is fully paid off or not in default.
What if my property was foreclosed years ago and sold for more than I owed?
You may be able to claim the surplus proceeds under the Rafaeli ruling, even for older sales, since the Michigan Supreme Court held this applies retroactively. Contact your county treasurer’s office for the claim process.
Behind on Property Taxes? Explore Your Options
If a sale makes sense for your situation, we can give you a fair, fast, no-obligation cash offer — often within 24 hours.