LANSING – State Representative Robert Dean (D-Grand Rapids) today voted to create the Home Foreclosure Prevention Act, which requires lenders to make homeowners aware of programs and resources available to them to help avoid foreclosure. The act is another piece of a comprehensive plan attacking the subprime mortgage crisis in Michigan.
"The more families that own homes, the stronger our communities are," said Dean. "During these difficult economic times, many of our working families are just getting by and struggling to pay their mortgages. The Home Foreclosure Prevention Act will make sure they are aware of all the options available to them to help them stay in their homes and keep their piece of the American Dream."
The Home Foreclosure Prevention Act requires the Office of Financial and Insurance Regulation (OFIR) to establish the Michigan Home Foreclosure Prevention Program, which will seek solutions to avoid foreclosures for certain subprime loans. The Act also requires lenders to send a written notice to borrowers at least 45 days before initiating a foreclosure. That notice must include options available to homeowners to help keep them in their homes.
Dean and his colleagues previously passed the Michigan Home Loan Protection Act, which bans predatory lending practices such as making loans without requiring borrowers to prove their ability to repay them, and the "Save the Dream" package, which establishes programs to allow homeowners saddled with risky adjustable-rate mortgages and those who have missed mortgage payments to refinance and secure a fixed-rate loan.
Dean and his colleagues' dedication to ending the foreclosure crisis in Michigan is already producing results – foreclosure filings in October were down 15 percent from a year ago. [1]
"While it may seem that there are no viable options when facing the threat of a foreclosure, there are many resources and services available that can help homeowners," said Dean. "The Home Foreclosure Prevention Act will help educate our residents about the options available to them, and help keep more of our working families in their homes."