The Michigan House of Representatives recently passed several statues to help regulate the mortgage industry. Still awaiting disposition in the Senate, the statues establish licensing standards for mortgage brokers not related to any banking institution.
MI State Representative Mark Meadows (D - 69th District) explains the statutes: “You may ask why the Legislature would meddle in what is essentially a business decision and why we would exclude banks from its coverage. While banks have made their share of bad investments in these tough economic times, they have not played a great part in the foreclosure crisis. You have read about sub-prime loans. What they are is a loan to an individual with perhaps the ability to pay the introductory rate but little chance to pay the escalated rate that will take place in the future. Many of the mortgage loans issued by private mortgage company brokers fell into this category. It may have been anticipated that the mortgage company would end up owning the property with escalating land values, and end up with a windfall profit. What was unanticipated, was the enduring, endless, unremitting decline in our economy.”
Below is a list of the bills that make up the House’s Predatory Lending Package, currently awaiting Senate Disposition:
Please note: All bills sent to the Senate for consideration
Theses bills make up the House’s predatory lending package which targets a variety of practices which disproportionately affect lower income and minority borrowers. Predatory lending occurs most frequently with subprime loans, or loans made to people who ordinarily would not qualify for a loan.
- HB 5294 (Simpson), Passed 80-29
House Bill 5294 amends the title and definitions sections of the Consumer Mortgage Protection Act to include predatory lending.
- HB 5295 (Tobocman), Passed 81-28
House Bill 5295 prevents lenders from including various products in home loans.
- HB 5296 (Melton), Passed 81-28
House Bill 5296 creates additional requirements for lenders who use high-cost home loans.
- HB 5297 (Angerer), Passed 106-2
House Bill 5297 (H-1) provides technical changes the Consumer Mortgage Protection Act.
- HB 5299 (Clack), Passed 72-37
House Bill 5299 provides claims and defenses for civil cases concerning high-cost home loans.
- HB 5300 (Corriveau), Passed 99-10
House Bill 5300 (H-1) amends the Consumer Mortgage Protection Act to add to and clarify the duties of the Commissioner of the Office of Financial and Insurance Regulation (OFIR).
- HB 5301 (Gaffney), Passed 101-8
House Bill 5301 (H-1) amends the Consumer Mortgage Protection Act to revise the penalties for violations of the Act.
- HB 5302 (Ebli), Passed 109-0
House Bill 5302 (H-1) the Consumer Mortgage Protection Act to revise and update the intent of the act and to whom it applies.
- HB 5303 (Calley), Passed 106-2
House Bill 5303 (H-1) makes technical changes to the Consumer Mortgage Protection Act.
- HB 5307 (Young), Passed 85-23
House Bill 5307 establishes the requirements that brokers, licensers and servicers must follow when making a mortgage loan.
- HB 5308 (Valentine), Passed 81-27
House Bill 5308 creates these same responsibilities for individuals licensed under the Secondary Mortgage Loan Act.