How to Understand Michigan's New Foreclosure Law

In an attempt to reduce the amount of foreclosures in Michigan, the legislature has passed a new law to help homeowners keep their home. The law goes into effect on July 5th, 2009 and ends on July 5th, 2011. Understanding this new foreclosure law is important because it gives homeowners new rights against the mortgage company.

Difficulty:

Moderately Easy

Instructions

1. With Michigan's new foreclosure law, a mortgage company cannot start the foreclose on a home until it takes part in a 90 day pre-foreclosure workout process. This time is suppose to be used to try and work out a loan modification that the homeowner can afford.

2. When this 90 days begins, the mortgage company must send written notice to the homeowner. The contents of the notice must include the following according to Michigan's new foreclosure law.

3. 1)Why the house is in foreclosure, how much is due and what is the total amount owed.

4. 2) Name, address, and phone number of the mortgage company and/or the servicer. Not all mortgages have a servicer.

5. 3) A list of HUD or MSHDA approved agencies in the homeowners area.

6. 4) The name of the person that homeowners can call in order to do a loan modification. The homeowner has 14 days from the day the letter was mailed to contact this person to receive a workout.

7. 5) Lastly, the notice must contain a clause stating that the homeowner has a right to contact a lawyer and include the phone number to lawyer referral and also the local legal aid.

8. If your mortgage company doesn't do one of the above steps as required by the new Michigan foreclosure law, you should contact an attorney!