Land Contract Forfeitures in Macomb County, Michigan: When the Memorandum You Never Saw Destroys Your Title

The Hypothetical Scenario

Suppose you purchase a property at a Macomb County tax foreclosure auction for $45,000. The county records show a warranty deed from 2019 conveying the property from the original owner to a buyer. Standard title work reveals no mortgage, no judgment liens, nothing alarming. You close, record your deed, and begin renovations.

Three months later, an attorney contacts you. His client — someone whose name you've never seen — claims to be the "true" owner. The 2019 deed you relied on? It was from a land contract vendee who defaulted in 2021. The original vendor forfeited the contract, and the vendee's interest was extinguished without any foreclosure proceeding appearing in circuit court records. The vendor recorded a single document: an Affidavit of Forfeiture, which your title search either missed or misidentified as irrelevant. The vendor never took back a deed because under Michigan law, he didn't need one.

You now hold a deed from someone who had no interest to convey at the time of the tax sale.

How Michigan Land Contract Forfeitures Work

Michigan is one of the most vendor-friendly states for land contract enforcement. Unlike mortgage foreclosure — which requires either judicial process or strict compliance with foreclosure-by-advertisement statutes — land contract forfeiture can occur through a summary proceeding that generates minimal public record footprint.

The governing statute is MCL 600.5726 et seq., which establishes the forfeiture process for land contracts. When a vendee defaults, the vendor has two primary remedies:

Option 1: Foreclosure as a Mortgage Under MCL 565.359, the vendor may elect to foreclose the land contract as if it were a mortgage. This creates a full court record, a sheriff's sale, and clear chain-of-title documentation. Sophisticated vendors rarely choose this path because it's slower and more expensive.

Option 2: Summary Forfeiture Proceeding Under MCL 600.5726 and MCL 600.5728, if the vendee has paid less than 50% of the purchase price, the vendor can pursue forfeiture through a summary proceeding. The vendor serves a notice of forfeiture, and if the vendee fails to cure within the statutory period (typically 90 days for contracts under certain thresholds, potentially 180 days in other circumstances per MCL 600.5728), the vendor can obtain a judgment of forfeiture in district court.

The critical point for title searchers: this forfeiture judgment may be entered in district court, not circuit court. In Macomb County, that means it could appear in the 41-A District Court (Sterling Heights), 41-B District Court (Clinton Township), 42-1 District Court (Romeo), or one of several other district courts depending on the property location. Many title searches focus on circuit court records and the Register of Deeds, potentially missing district court forfeiture judgments entirely.

The Memorandum Problem

Michigan law does not require recording of a land contract itself. MCL 565.361 permits parties to record a "memorandum of land contract" containing only summary information: the names of the parties, the legal description, the date of the contract, and the signature of the vendor. Many vendors record nothing at all, preferring to keep the contract terms private.

When a memorandum is recorded, it puts the world on notice that the record owner may have conveyed an equitable interest. When no memorandum is recorded, the land contract exists entirely off-record, invisible to standard title searches until something goes wrong.

After forfeiture, MCL 565.358 allows the vendor to record an affidavit stating that the land contract has been forfeited. This affidavit, if recorded, theoretically clears the cloud. But the statute uses permissive language — the vendor "may" record, not "shall." Some vendors simply do nothing, leaving the memorandum of record with no corresponding satisfaction or forfeiture document.

In Macomb County, the Register of Deeds office indexes these affidavits, but they may be indexed under various document types. A search for "forfeiture" might not surface a document titled "Affidavit of Land Contract Termination" or similar variants. The indexing depends on how the recording party described the document.

Why Standard Title Searches Miss This

The typical title search examines:

Deeds in the chain of title
Mortgages and their satisfactions
Liens (tax, judgment, mechanic's)
Probate proceedings affecting the property
Circuit court actions naming property owners

This search will usually catch a recorded memorandum of land contract. The problem arises when:

No memorandum was ever recorded. The vendor conveyed equitable title entirely off-record. The vendee's interest existed, could be sold, could be mortgaged (creating an equitable mortgage), and could be forfeited — all without any document appearing in Register of Deeds records.
The forfeiture occurred in district court. The 16th Circuit Court in Macomb County handles major civil matters, but land contract forfeitures meeting the statutory criteria proceed in district court. A title search limited to circuit court records misses these entirely.
The vendee purported to convey fee simple. A land contract vendee holds equitable title and can convey their interest. If a vendee records a warranty deed (perhaps as part of a sale or to a judgment creditor), subsequent searchers see what looks like a clean deed. They have no reason to look behind it unless they examine the vendee's acquisition document — which, if it was a land contract never recorded, doesn't exist in public records.
The property went to tax sale from the vendee. Macomb County Treasurer's tax foreclosure sales convey whatever interest the delinquent taxpayer held. If the delinquent party was a vendee whose interest was forfeited before the tax sale, the county conveyed nothing.

The Foreclosure Alternative: What to Watch For

When a vendor elects to foreclose a land contract as a mortgage under MCL 565.359, the process creates substantially more documentation:

A complaint filed in Macomb County Circuit Court
A lis pendens recorded with the Register of Deeds
A judgment of foreclosure
A sheriff's sale with recorded certificate
A deed upon expiration of the redemption period

This path is title-searcher friendly because every step generates a record. The problem is that vendors have no incentive to use it when forfeiture is faster and cheaper.

Michigan courts have held that once forfeiture is properly completed, the vendee's interest is extinguished as if it never existed. The vendor's fee simple title is restored without the need for any new conveyance. See Siegel v. Spinney, 141 Mich. App. 346 (1985), discussing the effect of forfeiture on the vendee's interest.

What TitlePin Can Help You Check

When examining Macomb County properties where land contracts may be involved, TitlePin can help you identify public-record signals that warrant deeper investigation:

Memoranda of land contract recorded against the property, including those that appear satisfied and those that remain open
Gaps in the deed chain where someone appears to have conveyed property they acquired through an unrecorded instrument
Affidavits referencing land contracts — including affidavits of forfeiture, termination, or fulfillment — which indicate a land contract existed even if the contract itself was never recorded
District court case searches for the property address or parties in the chain, which may reveal forfeiture proceedings that wouldn't appear in circuit court records
Tax foreclosure sale records identifying whether the delinquent party was a vendee rather than a fee owner

Verifying the current status of a potential forfeiture typically requires examining district court records in the jurisdiction where the property sits, contacting the court for case disposition information, and confirming whether any forfeiture judgment was entered and when.

The Practical Risk in Macomb County

Macomb County has seen significant land contract activity, particularly in municipalities like Warren, Sterling Heights, and Clinton Township, where affordable housing stock has attracted both investors and owner-occupants using seller financing. The 2008 foreclosure crisis created inventory that moved through land contracts, and many of those contracts have since been forfeited, assigned, or abandoned with incomplete documentation.

The Macomb County Register of Deeds maintains records at the county building in Mount Clemens. Online access is available through the county's website, but document images may require in-person review for older filings or those with indexing issues. Investigators should note that land contract memoranda filed before the county's electronic indexing system may be harder to locate through name searches alone.

District court records in Macomb County are maintained by each individual court. The Michigan Courts One Court of Justice website provides some case search functionality, but historical forfeiture judgments — particularly those from smaller district courts — may require direct inquiry with the specific court.

Key Takeaways

Michigan vendors can forfeit land contracts through district court summary proceedings that create minimal circuit court records and may not appear in standard title searches
A recorded memorandum of land contract alerts you to investigate, but the absence of a memorandum doesn't mean no land contract exists — they're not required to be recorded
Affidavits of forfeiture under MCL 565.358 are permissive, not mandatory — vendors may complete forfeiture and never record anything
Tax foreclosure sales convey only the interest the delinquent party held; if that party's land contract was forfeited before the tax sale, you may receive nothing
In Macomb County, land contract forfeitures may be processed through any of several district courts depending on property location — check the specific court with jurisdiction over the property address

Sources

MCL 565.358 — Recording affidavit of forfeiture or land contract fulfillment
MCL 565.359 — Election to treat land contract as mortgage for foreclosure
MCL 565.361 — Memorandum of land contract, recording
MCL 600.5726 et seq. — Summary proceedings to recover possession, including land contract forfeiture
Siegel v. Spinney, 141 Mich. App. 346 (1985)
Macomb County Register of Deeds: https://www.macombgov.org/registerofdeedsrecording
Michigan Courts One Court of Justice case search: https://courts.michigan.gov/