Legislature on Summer Break, but work continues on foreclosure language
Last month, Senate Bill 383, now Public Act 104 of 2013, was signed into law by Governor Snyder. As you may recall, the initial legislative proposal was to shorten Michigan's 6 month redemption period down to 2 months. With the signing of the new law, homeowners will still have the benefit of the 6-month redemption period in order to pursue short-sales and other transactions that provide for homeowner-to-homeowner transfers. In addition, Senate Bill 383 expands upon the current law providing for criminal penalties for damage done during the redemption period by providing lending institutions with the flexibility to perform inspections on the property after Sheriff Sale to make sure it 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.
While we applaud the work of the legislature on this bill, work continues to provide "clean up" language that protects both the consumer and the community. As written, the legislation is somewhat vague pertaining to home inspections and notices. The MAR has been involved in workgroup discussions with members from the executive and legislative branches, as well as other stakeholder groups throughout the summer in the hopes to provide clear parameters for both the homeowner and the servicer. The MAR will continue to update the membership as these meetings progress.