March 15, 2011, Introduced by Rep. Oakes and referred to the Committee on Banking and Financial Services.
A bill to amend 1961 PA 236, entitled
"Revised judicature act of 1961,"
by amending section 3204 (MCL 600.3204), as amended by 2009 PA 29;
and to repeal acts and parts of acts.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 3204. (1) Subject to subsection (4), a party may
foreclose a mortgage by advertisement if all of the following
(a) A default in a condition of the mortgage has occurred, by
which the power to sell became operative.
(b) An action or proceeding has not been instituted, at law,
to recover the debt secured by the mortgage or any part of the
mortgage; or, if an action or proceeding has been instituted, the
action or proceeding has been discontinued; or an execution on a
judgment rendered in an action or proceeding has been returned
unsatisfied, in whole or in part.
(c) The mortgage containing the power of sale has been
(d) The party foreclosing the mortgage is either the owner of
the indebtedness or of an interest in the indebtedness secured by
the mortgage or the servicing agent of the mortgage.
(2) If a mortgage is given to secure the payment of money by
installments, each of the installments mentioned in the mortgage
after the first shall be treated as a separate and independent
mortgage. The mortgage for each of the installments may be
foreclosed in the same manner and with the same effect as if a
separate mortgage were given for each subsequent installment. A
redemption of a sale by the mortgagor has the same effect as if the
sale for the installment had been made upon an independent prior
(3) If the party foreclosing a mortgage by advertisement is
not the original mortgagee, a record chain of title shall exist
prior to the date of sale under section 3216 evidencing the
assignment of the mortgage to the party foreclosing the mortgage.
(4) A party shall not commence proceedings under this chapter
to foreclose a mortgage of property described in section 3205a(1)
if 1 or more of the following apply:
(a) Notice has not been mailed to the mortgagor as required by
(b) After a notice is mailed to the mortgagor under section
3205a, the time for a housing counselor to notify the person
designated under section 3205a(1)(c) of a request by the mortgagor
under section 3205b(1) has not expired.
(c) Within 14 days after a notice is mailed to the mortgagor
under section 3205a, the mortgagor has requested a meeting under
section 3205b with the person designated under section 3205a(1)(c)
and 90 days have not passed after the notice was mailed.
(d) The mortgagor has requested a meeting under section 3205b
with the person designated under section 3205a(1)(c), the mortgagor
has provided documents if requested under section 3205b(2), and the
person designated under section 3205a(1)(c) has not met or
negotiated with the mortgagor under this chapter.
(e) The mortgagor and mortgagee have agreed to modify the
mortgage loan and the mortgagor is not in default under the
(f) Calculations under section 3205c(1) show that the
mortgagor is eligible for a loan modification and foreclosure under
this chapter is not allowed under section 3205c(7).
(5) Subsection (4) applies only to proceedings under this
chapter in which the first notice under section 3208 is published
the effective date of the amendatory act that added this subsection
and before 2 years after the effective date of the amendatory
act that added this subsection July
Enacting section 1. Section 3205e of the revised judicature
act of 1961, 1961 PA 236, MCL 600.3205e, is repealed.