Bill Text: MI HB4536 | 2011-2012 | 96th Legislature | Introduced

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Bill Title: Civil procedure; foreclosure; mortgage loan modification negotiation program; extend sunset. Amends secs. 3204 & 3205e of 1961 PA 236 (MCL 600.3204 & 600.3205e).

Spectrum: Partisan Bill (Democrat 3-0)

Status: (Introduced - Dead) 2011-04-14 - Printed Bill Filed 04/14/2011 [HB4536 Detail]

Download: Michigan-2011-HB4536-Introduced.html

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HOUSE BILL No. 4536

 

April 13, 2011, Introduced by Reps. Oakes, Ananich and Cavanagh and referred to the Committee on Banking and Financial Services.

 

     A bill to amend 1961 PA 236, entitled

 

"Revised judicature act of 1961,"

 

by amending sections 3204 and 3205e (MCL 600.3204 and 600.3205e),

 

section 3204 as amended by 2009 PA 29 and section 3205e as added by

 

2009 PA 31.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 3204. (1) Subject to subsection (4), a party may

 

foreclose a mortgage by advertisement if all of the following

 

circumstances exist:

 

     (a) A default in a condition of the mortgage has occurred, by

 

which the power to sell became operative.

 

     (b) An action or proceeding has not been instituted, at law,

 

to recover the debt secured by the mortgage or any part of the

 

mortgage; or, if an action or proceeding has been instituted, the

 

action or proceeding has been discontinued; or an execution on a

 

judgment rendered in an action or proceeding has been returned

 

unsatisfied, in whole or in part.

 

     (c) The mortgage containing the power of sale has been

 

properly recorded.

 

     (d) The party foreclosing the mortgage is either the owner of

 

the indebtedness or of an interest in the indebtedness secured by

 

the mortgage or the servicing agent of the mortgage.

 

     (2) If a mortgage is given to secure the payment of money by

 

installments, each of the installments mentioned in the mortgage

 

after the first shall be treated as a separate and independent

 

mortgage. The mortgage for each of the installments may be

 

foreclosed in the same manner and with the same effect as if a

 

separate mortgage were given for each subsequent installment. A

 

redemption of a sale by the mortgagor has the same effect as if the

 

sale for the installment had been made upon an independent prior

 

mortgage.

 

     (3) If the party foreclosing a mortgage by advertisement is

 

not the original mortgagee, a record chain of title shall exist

 

prior to the date of sale under section 3216 evidencing the

 

assignment of the mortgage to the party foreclosing the mortgage.

 

     (4) A party shall not commence proceedings under this chapter

 

to foreclose a mortgage of property described in section 3205a(1)

 

if 1 or more of the following apply:

 

     (a) Notice has not been mailed to the mortgagor as required by

 

section 3205a.

 

     (b) After a notice is mailed to the mortgagor under section

 

3205a, the time for a housing counselor to notify the person

 

designated under section 3205a(1)(c) of a request by the mortgagor

 

under section 3205b(1) has not expired.

 

     (c) Within 14 days after a notice is mailed to the mortgagor

 

under section 3205a, the mortgagor has requested a meeting under

 

section 3205b with the person designated under section 3205a(1)(c)

 

and 90 days have not passed after the notice was mailed.

 

     (d) The mortgagor has requested a meeting under section 3205b

 

with the person designated under section 3205a(1)(c), the mortgagor

 

has provided documents if requested under section 3205b(2), and the

 

person designated under section 3205a(1)(c) has not met or

 

negotiated with the mortgagor under this chapter.

 

     (e) The mortgagor and mortgagee have agreed to modify the

 

mortgage loan and the mortgagor is not in default under the

 

modified agreement.

 

     (f) Calculations under section 3205c(1) show that the

 

mortgagor is eligible for a loan modification and foreclosure under

 

this chapter is not allowed under section 3205c(7).

 

     (5) Subsection (4) applies only to proceedings under this

 

chapter in which the first notice under section 3208 is published

 

after the effective date of the amendatory act that added this

 

subsection July 5, 2009 and before 2 years after the effective date

 

of the amendatory act that added this subsection July 5, 2013.

 

     Sec. 3205e. Sections 3205a to 3205d are repealed effective 2

 

years after the effective date of the amendatory act that added

 

this section July 5, 2013.