Legislation & Policy


Get the news on policy and legislation related to mortgage and housing issues delivered by eMail

 

News on Policy and legislation around the topic of mortgage foreclosure are constantly changing.  FPR will try to provide up-to-date information about  the newest local, state, and federal policy and legislation related to mortgage and housing issues.  Please check back often or sign up for our Newsletter/Policy Alerts


You'll find the find the following at this page

 

 

New Michigan State 90 Day Pre-Foreclosure Negotiation Law


On May 20, 2009, the Governor signed into law amendments to the Michigan Foreclosure by Advertisement Statute.  The new law requires a mandatory 90-day pre-foreclosure process to allow the borrower and the mortgage holder to work together to avoid foreclosure. The new law takes effect July 5, 2009 and expires July 5, 2011.


Frequently Asked Questions:

 

Does this law apply to all foreclosures?

It does not apply if the borrower and the mortgage holder previously agreed to modify the mortgage loan and, within a year, the borrower failed to comply with the terms of the loan modification.


Are all properties covered?

It applies to property the borrower claims as a principal residence exempt from taxes.

 

When can a mortgage holder or servicer begin foreclosure proceedings by advertisement?

Before beginning foreclosure proceedings by advertisement, a mortgage holder or servicer must comply with a 90-day pre-foreclosure process to attempt to avoid foreclosure.  The mortgage holder or servicer first must serve a written notice on the borrower informing the borrower of his or her rights and the opportunity to avoid foreclosure.

What information must be included in the written notice?

The written notice must contain all of the following information:

  • Contact information for the mortgage servicer or agent designated by mortgage servicer.

  • A list of housing counselors approved by the U.S. Department of Housing and Urban Development (HUD) or the Michigan State Housing Development Authority (MSHDA).

  • Notice that within 14 days after the written notice is mailed, the borrower should request a meeting with the designated agent to attempt to work out a loan modification to avoid foreclosure.

  • Notice that if the borrower requests the meeting, foreclosure proceedings will not begin until 90 days after the date the notice is mailed to the borrower.

What does the borrower have to do?

A borrower who wishes to negotiate a loan modification must contact a housing counselor from the list provided within 14 days after the list is mailed to the borrower.  The borrower may also contact the designated agent to request a meeting.  Upon request, the borrower must give the designated agent, documents needed to determine whether the borrower is eligible for a loan modification.

What happens if the mortgage holder or servicer does not comply with the law?

If the mortgage holder or servicer begins to foreclose by advertisement in violation of the law, the borrower may file an action in circuit court to convert the foreclosure proceedings to a judicial foreclosure.

If a borrower files an action and the court determines that the borrower participated in the process, a modification agreement was not reached, the borrower is eligible for modification and the borrower timely executed and returned the modification agreement, the court must convert the foreclosure by advertisement to a judicial foreclosure process.

For more detailed information, please  get a PDF
To review the actual legislation in pdf:
House Bill 4453  | House Bill 4454  | House Bill 4455

 

Federal Tenant Protections at Foreclosure


On May 20, 2009, President Obama signed a bill requiring a 90-day pre-eviction notice for tenants in foreclosed properties nationwide.  This legislation will require that in the event of foreclosure, existing leases for renters are honored, except in the case of month-to-month leases or owner occupant foreclosing. If so, a minimum of 90 days notice will be required.  Parallel protections are put in place for Section 8 tenants.  For more details, click here.

 

Updates to the federal Making Home Affordable Plan


The Obama Administration has introduced a comprehensive Financial Stability Plan to address key problems and get our economy back on track. A critical piece of that effort is Making Home Affordable plan. The Home Affordable Refinance Program gives up to four to five million homeowners with loans owned or guaranteed by Fannie Mae or Freddie Mac an opportunity to refinance into more affordable monthly payments.  Read more about the plan here.

 


Links and resources for more policy-related information

 

 

Foreclosure-response.org

Foreclosure-Response.org is a website offering resources intended to help states and localities respond to the foreclosure crisis. This site is maintained by the Center for Housing Policy, KnowledgePlex, Local Initiatives Support Corporation (LISC), and the Urban Institute.

 

Community and Economic Development Association of Michigan

The Community Economic Development Association of Michigan (CEDAM) promotes rebuilding neighborhoods and revitalizing communities throughout Michigan CEDAM tracks many policy related issues.

 

Legislative Resources

 

STATE:

To track legislative activity in the Michigan State Legislature, click here.

To find your Michigan State Representative, click here.

To find your Michigan State Senator, click here.

To save or view a PDF of  "A Citizen's Guide to State Government" (Michigan), click here.

To Contact Michigan State Officials and Agencies, click here.

To visit the State of Michigan website, click here.


FEDERAL

To find your U.S. Representative or track legislative activity, click here.

To find your U.S. Senators or track legislative activity, click here.

U.S. Government Official Web Portal, click here. 

To track U.S. Legislation at the Library of Congress (Thomas), click here.