LANSING – State Representative Terry Brown (D- Pigeon) today voted for a plan 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 to help solve the subprime mortgage crisis in Michigan.
"As we work to create good-paying jobs and turn our economy around, we have to do everything we can to help working families keep their homes," Brown said. "This plan will encourage more struggling homeowners to seek advice and assistance early so they can focus on avoiding foreclosure, rather than picking up the pieces afterward. Everyone wins when we find solutions that enable homeowners to pay their mortgages and stay in their homes."
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.
Brown 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.
Brown urges residents who are at risk of foreclosure to seek free assistance through the Human Development Commission by calling (800) 843-6394. Residents can also visit MSHDA's foreclosure assistance Web site, Michigan.gov/savethedream.
"Homeowners who are struggling need to know that there are options available if they are facing the loss of the home they worked so hard to buy," Brown said. "This plan provides another tool in the fight against foreclosures, which continue to take a huge toll on our families, our communities and our economy."