The Road to Redemption: Is 3 Months Enougth Time?

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And the answer is, NO!

WARNING: Harmful State Foreclosure Legislation due to be voted on by April 27th

Please take action today!

The Issue:

HB 4544 section 3240 introduced on Tuesday April 12th, 2011 seeks to reduce the Michigan redemption period by 3 months from its current 6 months.

The redemption period is the time a homeowner has after foreclosure to live in their home. This time can be used to redeem, sell the property. It also gives families time to find new housing.

Problems with this proposal:

§ The current redemption period has been in effect since 1961, shortening the time someone has to live in their home after they have endured foreclosure during the worst foreclosure crisis since the Great Depression does not make sense. Additionally, this legislation is out sync with the nation. There is no other state attempting to make the foreclosure process faster.

§ Both the National Consumer Law Center (NCLC ) and Fannie Mae have done state by state analysis on foreclosure timelines. Each of these reports has Michigan falling in the middle relative to other states nationwide.

§ Redemption Periods can already be shortened for abandoned properties, under current law, to 30 days.

§ This legislation is attached to a set of bills proposing a one year extension to the 90 day law. This law, created in 2009, allows homeowners the ability to “opt-in” to a 90 day negotiation period with their lender. As stated above this proposal looks to extend that for one year, but the redemption period curtailment is permanent.

§ This law is short-sighted. In the current economic state there are few people who are able to redeem their properties or sell for a profit. However, it is not anticipated that this will last forever. A permanent reduction in the time people have to pursue these options will affect homeowners in good economic times as well. Also, anecdotally, Home Repair Services has assisted a handful of clients with the redemption and/or rescission of their foreclosures and this has always taken us more than 3 months.

Please contact your State representative by phone or email ASAP. . If your Rep is not on your speed dial, you can find him/her at:

Some of our neighborhood is covered by Representative Lisa Lyons who is sponsoring this bill. Take a look at the link to see if you fall in her district, and if this is not the way you would like to be governed let her know!

Thanks to Kym Spring at Foreclosure Response for providing the info!

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