By the close of 2013, the MCUL & Affiliates had sent several key legislative measures to Gov. Rick Snyder’s desk for his signature. As the new year begins, the MCUL will focus on finishing remaining initiatives prior to the summer recess. Primary issues will include: attention to bills to “clean up” the right of inspection on properties in redemption and other foreclosure process reforms enacted last year; electronic titling and lien release for titled vehicles; use of verified copies for lost documents in the property recording process; and reforming penalty provisions in Michigan’s version of the Uniform Commercial Code.
Since the summer of 2013, the MCUL has been a participant in ongoing discussions on foreclosure reform. Following repeal of the state 90-day pre-foreclosure workout law and creation of a new right of inspection for properties in redemption, the need for common sense parameters has been an ongoing discussion topic, along with as-yet-unaddressed issues with owners that abandon properties. Consumer interests voiced a desire to provide reasonable notice of inspections or perhaps place a reasonable cap on the number of regular inspections, with exception for emergency situations where damage or imminent damage is reasonably suspected. Others suggested that simple notice to the homeowner that a sale has occurred would be appropriate, and would assist both sides in a foreclosure situation in facilitating necessary communications. From the industry’s view, the homeowners’ right to cure damage prior to the summary possession action needs to be reworked, and stronger liability provisions against those borrowers who abandon a property without notice to the purchaser would be very beneficial. Legislation will likely be introduced in the first quarter, in the House.
In April of 2013, Rep. Peter Pettalia, R-Presque Isle, and Rep. Marilyn Lane, D-Fraser, introduced House Bills 4638-4640, to allow a copy of an original mortgage-related instrument that is verified by an affidavit and recorded, to be deemed as complying with all recording requirements in this state. MCUL strongly supports these bills, which will help to protect title chains and strengthen lenders’ ability to assert their related rights. Please take a moment to let members of the House Committee on Local Government know that you support these bills, and strongly urge them to consider and act upon them early this year, by clicking here.
In of 2013, Sen. Darwin Booher, R-Evart, introduced a package of bills to update Michigan’s Uniform Commercial Code, focusing on Articles 3 and 4 (bank deposits and negotiable instruments), and 4a (harmonizing state and federal law with regard to remittance transfers). In addition to the nationally proposed updates, SB 551 would amend existing non-compliance penalty provisions in Article 9 (secured transactions) that in their current form are extremely disproportionate and could potentially provide fertile ground for inappropriate and dangerous litigation. SB 551, along with the other measures, has passed the Senate, and action in the House Financial Services Committee is likely in the first quarter.
Early in 2014, legislation is expected in the first quarter that will centralize title holding for vehicles (autos, boats, manufactured, etc.) and move Michigan into an electronic medium for titling and lien release for vehicles. Secretary of State Ruth Johnson’s office will spearhead the initiative, and she has worked closely with financial institutions and industry participants to develop the pending bills. Michigan is among the last states to make this shift, and the likely proposal will help financial institutions and dealers realize greater efficiencies and prevent fraud that is rooted in the paper-based system.
MCUL will provide regular updates on the issues affecting the credit union industry at the state level. If you have any questions regarding state legislative activities please do not hesitate to contact Kieran Marion, vice president of Governmental Affairs, at Kieran.Marion@mcul.org or Director of Government Affairs Jordan Kingdon at Jordan.Kingdon@mcul.org.