Snyder Signs Bill to Help Homeowners Avoid Foreclosure
Gov. Rick Snyder has signed a series of bills that clarify and improve the pre-foreclosure and foreclosure process and will help keep Michigan residents in their homes. This bipartisan legislative package passed both chambers unanimously.
“This legislation helps protect families and ensures the stability of Michigan communities,” said Snyder. “When foreclosures are prevented, homes are not vacated, families are not displaced and townships, cities and counties do not lose the tax base provided by homeownership.”
In September 2011, there was one foreclosure filing for every 149 homes in Michigan. Michigan also had the seventh highest foreclosure rates and foreclosure filing totals compared with other states.
House Bill 4542, sponsored by state Rep. Jeff Farrington, and H.B. 4543, sponsored by state Rep. Peter Pettalia, require lenders to provide written notice which includes a list of housing counselors when foreclosure proceedings begin so that homeowners can receive immediate advice on their unique situation. The bills also provide additional time and mechanisms for homeowners to potentially arrange for loan modifications in order to prevent foreclosure. These modifications may include interest rate reduction, principal forbearance and other modifications designed to make monthly payments more affordable.
The legislation also removes the mandate to publish pre-foreclosure notices in newspapers to help prevent homeowners from being solicited by foreclosure rescue and mortgage modification scams.
H.B. 4544, sponsored by state Rep. Lisa Lyons, clarifies that the redemption period of one year is for property used for agricultural purposes.
“This legislative package provides Michigan homeowners with a set of tools to help them stay in their homes and avoid foreclosure,” said Kevin Clinton, Commissioner of the Office of Financial and Insurance Regulation.
H.B. 4542, 4543 and 4544 are now Public Acts 301, 302 and 303 of 2011.