Legislation Preserving the Foreclosure Redemption Period Heads to the Governor for Signature

WASHINGTON, D.C. – June 21, 2013 – (RealEstateRama) — Today, the Michigan legislature passed legislation keeping the six-month foreclosure redemption period intact. Senate Bill 383  provides lending institutions with the flexibility to perform an inspection on the property after the property goes to Sheriff Sale. This is to ensure that the property is being kept up and not being stripped of its valuables. If the bank finds that the property is being stripped of its possessions or vandalized, the bank may take the homeowner to court to accelerate the redemption period.  One of the major concerns raised by opponents of the six-month redemption period was that, in some instances, properties were being stripped of their valuables before the bank could take ownership. This provision will allow the bank take the property back in an expedited fashion should it be put in harms way.

However, if the property is being kept in good condition, the homeowner keeps the entire six-month redemption period, as written in current law. In turn, he or she can look to pursue options that support homeowner to homeowner transactions, including a short sale. These are options that have been strongly supported by our REALTOR® membership.

Thank you to all of the REALTORS® who contacted their legislators and shared their experiences to illustrate why preserving the foreclosure redemption period is vital. These bills are expected to be signed into law rather quickly.  Watch for an upcoming MAR Public Policy Vodcast for more information on the legislation.