March 30, 2006, Introduced by Senator CROPSEY and referred to the Committee on Judiciary.
A bill to amend 1961 PA 236, entitled
"Revised judicature act of 1961,"
by amending sections 3240 and 3241a (MCL 600.3240 and 600.3241a),
section 3240 as amended by 2004 PA 538 and section 3241a as added
by 1986 PA 94.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 3240. (1) A purchaser's deed is void if the mortgagor,
the mortgagor's heirs, executors, or administrators, or any person
lawfully claiming under the mortgagor or the mortgagor's heirs,
executors, or administrators redeems the entire premises sold by
paying the amount required under subsection (2), within the
applicable time limit prescribed in subsections (7) to (12), to the
purchaser or the purchaser's executors, administrators, or assigns,
or to the register of deeds in whose office the deed is deposited
for the benefit of the purchaser.
(2) The amount required to be paid under subsection (1) is the
sum that was bid for the entire premises sold, with interest from
the date of the sale at the interest rate provided for by the
mortgage, together with the amount of the sheriff's fee paid by the
purchaser under section 2558(2)(q), and an additional $5.00 as a
fee for the care and custody of the redemption money if the payment
is made to the register of deeds. The register of deeds shall not
determine the amount necessary for redemption. The purchaser shall
attach an affidavit with the deed to be recorded under this section
that states the exact amount required to redeem the property under
this subsection, including any daily per diem amounts, and the date
by which the property must be redeemed shall be stated on the
certificate of sale. The purchaser may include in the affidavit the
name of a designee responsible on behalf of the purchaser to assist
the person redeeming the property in computing the exact amount
required to redeem the property. The designee may charge a fee as
stated in the affidavit and may be authorized by the purchaser to
receive redemption funds. The purchaser shall accept the amount
computed by the designee.
(3) If a distinct lot or parcel separately sold is redeemed,
leaving a portion of the premises unredeemed, the deed shall be
void only to the redeemed parcel or parcels.
(4) If after the sale the purchaser, the purchaser's heirs,
executors, or administrators, or any person lawfully claiming under
the purchaser or the purchaser's heirs, executors, or
administrators pays taxes assessed against the property, amounts
necessary to redeem senior liens from foreclosure, condominium
assessments, homeowner association assessments, community
association assessments, or premiums on an insurance policy
covering any buildings located on the property that under the terms
of the mortgage it would have been the duty of the mortgagor to pay
if the mortgage had not been foreclosed and that are necessary to
keep the policy in force until the expiration of the period of
redemption, redemption shall be made only upon payment of the sum
specified in subsection (2) plus the amounts specified in this
subsection with interest on the amounts specified in this
subsection from the date of the payment to the date of redemption
at the interest rate specified in the mortgage, if all of the
following are filed with the register of deeds with whom the deed
is deposited:
(a) An affidavit by the purchaser or someone in his or her
behalf who has knowledge of the facts of the payment showing the
amount and items paid.
(b) The receipt or copy of the canceled check evidencing the
payment of the taxes, amounts necessary to redeem senior liens from
foreclosure, condominium assessments, homeowner association
assessments, community association assessments, or insurance
premiums.
(c) An affidavit of an insurance agent of the insurance
company stating that the payment was made and what portion of the
payment covers the premium for the period before the expiration of
the period of redemption.
(5) If the redemption payment in subsection (4) includes an
amount used to redeem a senior lien from a nonjudicial foreclosure,
the mortgagor shall have the same defenses against the purchaser
with respect to the amount used to redeem the senior lien as the
mortgagor would have had against the senior lien.
(6) The register of deeds shall indorse on the documents filed
under subsection (4) the time they are received. The register of
deeds shall record the affidavit of the purchaser only and shall
preserve in his or her files the recorded affidavit, receipts,
insurance receipts, and insurance agent's affidavit until
expiration of the period of redemption.
(7) For
Subject to subsections (9)
to (11), for a mortgage
executed on or after January 1, 1965, on commercial or industrial
property, or multifamily residential property in excess of 4 units,
the redemption period is 6 months from the date of the sale.
(8) For
Subject to subsections (9)
to (11), for a mortgage
executed on or after January 1, 1965, on residential property not
exceeding 4 units and not more than 3 acres in size, if the amount
claimed to be due on the mortgage at the date of the notice of
foreclosure is more than 66-2/3% of the original indebtedness
secured by the mortgage, the redemption period is 6 months.
(9) For
Subject to subsection (10),
for a mortgage on
residential
property, not exceeding 4 units and not more than 3
acres
in size, if the property is abandoned as determined under
section 3241, the redemption period is 3 months.
(10)
For a mortgage on residential property,
not exceeding 4
units
and not more than 3 acres in size, if the amount claimed to
be due on the mortgage at the date of the notice of foreclosure is
more than 66-2/3% of the original indebtedness secured by the
mortgage and the property is abandoned as determined under section
3241, the redemption period is 1 month.
(11) If the property is abandoned as determined under section
3241a, the redemption period is 30 days or until the time to
provide the notice required by section 3241a(c) expires, whichever
is later.
(12) In
any other case If
subsections (7) to (11) do not
apply, the redemption period is 1 year from the date of the sale.
(13) The amount stated in any affidavits recorded under this
section shall be the amount necessary to satisfy the requirements
for redemption under this section.
Sec.
3241a. (1) For purposes of this chapter, if foreclosure
proceedings have been commenced under this chapter against
residential
property, not exceeding 4 units and not more than 3
acres
in size, abandonment of premises shall be conclusively
presumed upon satisfaction of all of the following requirements
before the end of the redemption period:
(a) The mortgagee has made a personal inspection of the
mortgaged premises and the inspection does not reveal that the
mortgagor or persons claiming under the mortgagor are presently
occupying or will occupy the premises.
(b) The mortgagee has posted a notice at the time of making
the personal inspection and has mailed by certified mail, return
receipt requested, a notice to the mortgagor at the mortgagor's
last known address, which notices state that the mortgagee
considers the premises abandoned and that the mortgagor will lose
all rights of ownership 30 days after the foreclosure sale or when
the time to provide the notice required by subdivision (c) expires,
whichever is later, unless the mortgagor; the mortgagor's heirs,
executor, or administrator; or a person lawfully claiming from or
under 1 of them provides the notice required by subdivision (c).
(c)
Within 15 days after receipt of a the notice required by
subdivision (b) was posted and mailed, the mortgagor; the
mortgagor's heirs, executor, or administrator; or a person lawfully
claiming
from or under 1 of them does not give has not given
written notice by first-class mail to the mortgagee at an address
provided by the mortgagee in the notices required by subdivision
(b) stating that the premises are not abandoned.
(2)
This section applies to a foreclosure proceeding filed or
pending
after May 15, 1986.