Bill Text: MI HB4875 | 2017-2018 | 99th Legislature | Introduced
Bill Title: Property; mortgages; acceleration and foreclosure; prescribe time period for veterans. Amends sec. 3204 of 1961 PA 236 (MCL 600.3204) & adds secs. 3103, 3104 & 3203.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2017-09-06 - Bill Electronically Reproduced 08/16/2017 [HB4875 Detail]
Download: Michigan-2017-HB4875-Introduced.html
HOUSE BILL No. 4875
August 16, 2017, Introduced by Reps. Sabo, Chirkun, Byrd, Gay-Dagnogo, Brann, Lasinski, Hertel and Yanez and referred to the Committee on Military and Veterans Affairs.
A bill to amend 1961 PA 236, entitled
"Revised judicature act of 1961,"
by amending section 3204 (MCL 600.3204), as amended by 2014 PA 125,
and by adding sections 3103, 3104, and 3203.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 3103. (1) A mortgagee shall not declare the unpaid
balance of the indebtedness secured by a mortgage described in
subsection (2) due or accelerate future payments on the
indebtedness until 6 months after the mortgagee has first notified
the mortgagor of a default because of failure to pay a payment on
the indebtedness, taxes, or an insurance premium and of the
mortgagee's intent to take action because of the default.
(2) This section applies to a mortgage of residential property
that secures a loan for personal, family, or household use, if all
of the following apply to a mortgagor:
(a) The mortgagor is a veteran.
(b) The mortgagor was on active duty during the year before
the notification described in subsection (1).
(c) The mortgagor occupies all or a portion of the property as
a principal residence.
(3) If, within the time described in subsection (1), the
default described in subsection (1) is cured by paying the missed
payment, any reasonable interest and late fees allowed under the
mortgage, and reasonable attorney fees, the mortgagee shall declare
the mortgage reinstated and take no further action because of the
default.
(4) This section does not apply to a mortgage made before the
effective date of the amendatory act that added this section.
(5) As used in this section:
(a) "Active duty" means that term as defined in section 3185.
(b) "Mortgagee" includes a holder of the mortgage and an agent
of the mortgagee or holder of the mortgage, including a mortgage
servicer.
(c) "Veteran" means an individual who is a former service
member as that term is defined in section 3185.
Sec. 3104. If applicable to the mortgage, a person shall not
commence an action to foreclose a mortgage under this chapter
during the period described in section 3103(1) or if a default
under the mortgage is cured as described in section 3103(3).
Sec. 3203. (1) A mortgagee shall not declare the unpaid
balance of the indebtedness secured by a mortgage described in
subsection (2) due or accelerate future payments on the
indebtedness until 6 months after the mortgagee has first notified
the mortgagor of a default because of failure to pay a payment on
the indebtedness, taxes, or an insurance premium and of the
mortgagee's intent to take action because of the default.
(2) This section applies to a mortgage of residential property
that secures a loan for personal, family, or household use, if all
of the following apply to a mortgagor:
(a) The mortgagor is a veteran.
(b) The mortgagor was on active duty during the year before
the notification described in subsection (1).
(c) The mortgagor occupies all or a portion of the property as
a principal residence.
(3) If, within the time described in subsection (1), the
default described in subsection (1) is cured by paying the missed
payment, any reasonable interest and late fees allowed under the
mortgage, and reasonable attorney fees, the mortgagee shall declare
the mortgage reinstated and take no further action because of the
default.
(4) This section does not apply to a mortgage made before the
effective date of the amendatory act that added this section.
(5) As used in this section:
(a) "Active duty" means that term as defined in section 3185.
(b) "Mortgagee" includes a holder of the mortgage and an agent
of the mortgagee or holder of the mortgage, including a mortgage
servicer.
(c) "Veteran" means an individual who is a former service
member as that term is defined in section 3185.
Sec. 3204. (1) 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, either
the action or proceeding has been discontinued or an execution on a
judgment rendered in the 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.
(e) If applicable, the period described in section 3203(1) has
passed and a default under the mortgage has not been cured as
described in section 3203(3).
(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 must 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 on an independent prior
mortgage.
(3) If the party foreclosing a mortgage by advertisement is
not the original mortgagee, a record chain of title must exist
before the date of sale under section 3216 evidencing the
assignment of the mortgage to the party foreclosing the mortgage.
