|The Macomb Daily|
|Thursday, December 9, 2010|
New law to help fight foreclosure
|Homeowners will be able to contact county to see how much they owe|
By Chad Selweski, Macomb Daily Staff Writer
Legislation that assists Macomb County homeowners who are facing foreclosure and battling the banks will be signed into law later this week by Gov. Jennifer Granholm.
During their final marathon session of the year, lawmakers last week gave final approval to a bill that will make it easier for struggling homeowners to find out how much they owe on their mortgage by contacting their county clerk/register of deeds. The information would allow them to save their property when banks or investors are moving toward seizing the house.
As foreclosures reach record levels, many homeowners facing ouster have found that their phone calls and e-mails to banks or mortgage companies go unanswered. As a result, they cannot determine the exact amount owed on their home.
In other cases, lenders are charging up to $350 to calculate a homeowner’s redemption payoff at a time when the owner already faces desperate financial straits.
Officials say each calculation can be completed in a matter of minutes.
The legislation was authored by state Rep. Fred Miller, a Mount Clemens Democrat, and was pushed toward passage in a bipartisan effort by Macomb County Clerk Carmella Sabaugh, a Democrat; and Oakland County Clerk Ruth Johnson, a Republican.
Johnson, who becomes Michigan’s next secretary of state on Jan. 1, said the proposal merely requires “common decency.”
“Not everybody will be able to redeem their home, but we feel strongly that we need to provide every assistance in getting them the information they need to save their house,” Johnson said. “Unfortunately, this system is ripe for abuse because there are no checks and balances. Some families are easy prey for those without integrity or who are simply overwhelmed by the sheer volume of foreclosed homes.”
The bill would reverse a 2005 change in state law, restoring the previous service that allowed a county register of deeds to calculate the amount needed for a homeowner to redeem their mortgage and then lock in that number. Because of intense political opposition, the bill would only apply to three of Michigan’s largest counties — Macomb, Oakland and Kent.
At a December 2009 committee hearing in the state Capitol, a Waterford couple testified that a mortgage company told them it would take two months to provide a redemption amount. After numerous phone calls, faxes and advice from an attorney, they finally received the information and were able to save their home.
Due to daily accrued interest, the payment necessary to redeem a home constantly changes.
Sabaugh and Johnson said they can provide a figure, as an impartial third party, that will assist those seeking to gain a personal loan, perhaps from family or friends, to avoid foreclosure.
Once a home is scheduled for a sheriff’s auction, the homeowner has six months to redeem it.
“This new law lets us put information directly into the hands of homeowners and provides some hope in what can feel like a hopeless situation,” said Sabaugh. “Homeowners have Oakland County Clerk Ruth Johnson to thank because this bill would not have passed without her persistence.”
In Lansing, the bill faced a rough road toward passage, with opposition voiced by the Michigan Bankers Association and from many clerk/registers of deeds from outstate counties who were worried that the payment calculations will eventually fall on their shoulders, too.
Sabaugh’s office said they will charge a “reasonable” fee for the service.
Macomb County saw 6,723 home foreclosures in 2008, 5,974 foreclosures in 2009 and has already seen 7,134 foreclosures this year. Oakland County had 9,242 home foreclosures in 2008, nearly 8,500 in 2009 and has experienced 8,745 foreclosures this year.