Bulletin: MI2009002

Date:
August 05, 2009
To:
All Michigan Issuing Offices
RE:
Mortgage Foreclosure Procedures

Dear Associates:

Public Acts 29, 30 and 31 of 2009 became effective July 5, 2009, which Acts modify the Michigan foreclosure process. The Acts are effective for two years (July 5, 2011) and require that lenders serve notice on borrowers advising them of their ability to modify the mortgage terms, naming a representative of the lender to contact for that purpose and a list of MSHDA or HUD approved housing counselors to assist borrowers in the modification process. It is the goal of the legislation to grant homeowners the opportunity to restructure their loans and avoid foreclosure.

MCL 600.3205a (5) provides:

A borrower on whom notice is required to be served under this section who is not served and against whom foreclosure proceedings are commenced under this chapter may bring an action in the circuit court for the county in which the mortgage property is situated to enjoin the foreclosure.

MCL 600.3205a (3) provides that notice is to be sent by regular first class mail and certified mail (return receipt requested) with delivery restricted to the borrower. Within 7 days of the mailing of the notice, it is also to be published in the same manner as is required for the publishing of a notice of foreclosure.

As a consequence of these provisions, the Company shall require the use of a requirement in Schedule B of the Commitment on all mortgage foreclosure commitments, Michigan Foreclosure Guarantee and Commitments and commitments for sales out of a lender that has completed the foreclosure process (REO sales), as follows:

Submit evidence satisfactory to the Company that any borrower entitled to receive notice of foreclosure under MCLA 600.3204(4) has been served notice, as required, and that all the provisions of MCL 600.3205a, 600.3205b and 600.3205c have been complied with, if applicable.

Satisfactory evidence of service of notice would include proof of mailing (first class and registered mail), proof of publication (just as would be provided for the foreclosure itself) and an Affidavit signed by the lender stating that the applicable provisions of MCL 600.3205a, 600.3205b and 600.3205c have been complied with.

 


Michigan Statutes (Click to View)

 


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References

Bulletins Replaced:
None
Related Bulletins:
None
Underwriting Manual:
None
Exceptions Manual:
None
Forms:
None