Legislation would help Michigan homeowners with subprime mortgages avoid foreclosure
LANSING, MI – November 19, 2008 – (RealEstateRama) — Office of Financial and Insurance Regulation (OFIR) Commissioner Ken Ross today applauded the State House for passing the Michigan Home Foreclosure Prevention Act last night and strongly encouraged the State Senate to act immediately on the legislation. On a bipartisan vote, the House passed HBs 6614 and 6615 which would help Michigan homeowners with subprime mortgages avoid foreclosure by providing greater outreach to subprime borrowers facing foreclosure and encouraging lenders to find ways to help borrowers stay in their homes.
“One out of every five Michigan homeowners with subprime mortgages is currently in the foreclosure process and unfortunately those numbers are increasing. This legislation will strengthen the mediation process between borrowers and lenders and help find solutions to unnecessary foreclosures,” Ross said. “We applaud the State House for working on a bipartisan basis and passing these important bills and we hope the State Senate will move quickly on this legislation.”
The legislation requires that borrowers of subprime loans receive at least 45 days written notice including certain information regarding their loan from their lender before foreclosure proceedings can be initiated and establishes a database within the State Court Administrative Office to track certain pre-foreclosure information.
The legislation also establishes the “Michigan Home Foreclosure Prevention Program,” under which the OFIR Commissioner is authorized to extend the filing date for a foreclosure for up to 30 days and/or require the lender and the borrower to participate in mediation if there is a potential to work out terms.