Michigan Bankruptcy Laws - Limitations:
Michigan Compiled Laws Section 600.6023 provides, in part, "(h) . . . this exemption does not apply to any mortgage on the homestead, lawfully obtained, except that the mortgage is not valid without the signature of a married judgment debtor's spouse unless either of the following occurs: (i) The mortgage is given to secure the payment of the purchase money or a portion of the purchase money. (ii) The mortgage is recorded in the office of the register of deeds of the county in which the property is located, for a period of 25 years, and no notice of a claim of invalidity is filed in that office during the 25 years following the recording of the mortgage. (i) An equity of redemption as described in section 6060."
Operation of Michigan bankruptcy laws:
In practice, occupation of a home requires a physical presence of the debtor on a regular basis. Problems arise because of multiple tracts, absence from the state, and divorce proceedings which fracture the application of domicile rules. Clarifying both domicile and residency through a written designation prevents surprises. If the validity of a homestead exemption is in question, written agreements and designation provide many debtors with a solution. Note: Absence from the country because of military service can not form the sole basis of abandonment.
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