HOUSE BILL No. 4586

 

March 17, 2009, Introduced by Reps. Angerer, Simpson, Slavens, Liss and Barnett and referred to the Committee on Banking and Financial Services.

 

     A bill to amend 2002 PA 660, entitled

 

"Consumer mortgage protection act,"

 

by amending sections 6 and 7 (MCL 445.1636 and 445.1637).

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 6. At the time a person applies for a mortgage home loan,

 

the lender creditor shall provide the applicant the following

 

document:

 

     "BORROWERS BILL OF RIGHTS

 

     1. You have the RIGHT to shop for the best loan for you and

 

compare the charges of different mortgage brokers and lenders.

 

     2. You have the RIGHT to be informed about the total cost of

 

your loan including the interest rate, points, and other fees.

 

     3. You have the RIGHT to obtain a "Good Faith Estimate" of all

 

loan and settlement charges before you agree to the loan or pay any

 


fees.

 

     4. You have the RIGHT to know what fees are nonrefundable if

 

you decide to withdraw your loan application.

 

     5. You have the RIGHT to ask your mortgage broker to explain

 

exactly what the mortgage broker will do for you.

 

     6. You have the RIGHT to know how much the mortgage broker is

 

getting paid by you and the lender for your loan.

 

     7. You have the RIGHT to ask questions about charges and loan

 

terms that you do not understand.

 

     8. You have the RIGHT to a credit decision that is not based

 

on your race, color, religion, national origin, sex, marital

 

status, age, or whether any income is derived from public

 

assistance.

 

     9. You have the RIGHT to know the reason if your loan

 

application is turned down.".

 

     10. You have the RIGHT to receive the HUD settlement costs

 

booklet "Buying Your Home"."

 

     Sec. 7. At the time a person applies for a mortgage home loan,

 

the lender creditor shall provide the applicant the following

 

written notice regarding the value of receiving credit counseling

 

before taking out a mortgage home loan and a list of the nearest

 

available HUD-approved credit counseling agencies:

 

     "CONSUMER CAUTION AND HOME OWNERSHIP COUNSELING NOTICE

 

     If you obtain this loan, the lender will have a mortgage on

 

your home. You could lose your home, and all money you have

 

invested in it, if you do not meet your obligations under the loan,

 

including making all your payments.

 


     Mortgage loans rates and closing costs and fees vary based on

 

many factors, including your particular credit and financial

 

circumstances, your earnings history, the loan-to-value requested,

 

and the type of property that will secure your loan. Higher rates

 

and fees may be applicable depending on the individual

 

circumstances of a particular consumer's application.

 

     You should shop around and compare loan rates and fees. This

 

particular loan may have a higher rate and total points and fees

 

than other mortgage loans. You should consider consulting a

 

qualified independent credit counselor or other experienced

 

financial adviser regarding the rate, fees, and provisions of this

 

mortgage loan before you proceed. For information on contacting a

 

qualified credit counselor, ask your lender or call the United

 

States Department of Housing and Urban Development's counseling

 

hotline at 1-888-466-3487 for a list of counselors.

 

     You are not required to complete any loan agreement merely

 

because you have received these disclosures or have signed a loan

 

application. If you proceed with this mortgage loan, you should

 

also remember that you may face serious financial risks if you use

 

this loan to pay off credit card debts and other debts in

 

connection with this transaction and then subsequently incur

 

significant new credit card charges or other debts.

 

     Property taxes and homeowner's insurance are your

 

responsibility. Not all lenders provide escrow services for these

 

payments. You should ask your lender about these services.

 

     Your payments on existing debts contribute to your credit

 

ratings. You should not accept any advice to ignore your regular

 


payments to your existing creditors.".

 

     Enacting section 1. This amendatory act does not take effect

 

unless all of the following bills of the 95th Legislature are

 

enacted into law:

 

     (a) Senate Bill No.____ or House Bill No. 4592(request no.

 

01098'09).

 

     (b) Senate Bill No.____ or House Bill No. 4587(request no.

 

01099'09).

 

     (c) Senate Bill No.____ or House Bill No. 4585(request no.

 

01100'09).

 

     (d) Senate Bill No.____ or House Bill No. 4593(request no.

 

01103'09).

 

     (e) Senate Bill No.____ or House Bill No. 4590(request no.

 

01104'09).

 

     (f) Senate Bill No.____ or House Bill No. 4589(request no.

 

01105'09).

 

     (g) Senate Bill No.____ or House Bill No. 4591(request no.

 

01106'09).

 

     (h) Senate Bill No.____ or House Bill No. 4588(request no.

 

01107'09).