Michigan Legislation Aimed at Combatting Mortgage Fraud

Allison Tussey —  May 9, 2011 — 2 Comments

Legislative reforms have been proposed intended to strengthen the hand of prosecutors and law enforcement to combat mortgage fraud.

A bi-partisan package of bills introduced in the Michigan Senate will change Michigan law to better confront the devastating affects of mortgage fraud, including:

• Senate Bill 252, sponsored by Senator James Marleau (R-Rochester), which increases the penalty for violations of the notary act when a document affects interest in real estate from a misdemeanor to a four year felony;

• Senate Bill 253, sponsored by Senator John Gleason (D-Flushing), which amends sentencing guidelines to reflect the new felony penalty for notary violations related to real estate;

• Senate Bills 249 and 250, sponsored by Senator Darwin Booher (R-Evart), which increase the penalties for the crime of false pretenses (fraud) over $20,000;

• Senate Bill 251, sponsored by Senator Mike Nofs (R-Battle Creek), which increases the statute of limitations from six to ten years for crimes related to real property transactions. This will allow extra time for investigators, especially in cases when the crime is not revealed until years after the transaction is completed; and,

• Senate Bills 43 and 44, sponsored by Senator Tupac Hunter (D-Detroit), which define the specific crime of “Mortgage Fraud,” giving prosecutors a more precise tool to prosecute offenders.

The Michigan Attorney General’s office has played an aggressive role in prosecuting individuals and companies for mortgage-related crimes cross the state. Schuette has spoken with registers of deeds across the state and has initiated an investigation in response to their concerns that thousands of forged mortgage documents were filed in Michigan during the current foreclosure crisis. Schuette is also working with fellow attorneys general in a national workgroup examining mortgage lending practices, including the robo-signing issue and consumer protection concerns.

Michigan Attorney General Bill Schuette announced his support for the legislation. Schuette joins State Senator James Marleau (R-Lake Orion), Secretary of State Ruth Johnson and Oakland County Register of Deeds Bill Bullard, who came together to support legislative reforms in light of recent allegations of fraudulent mortgage documents filed in Michigan.

“Michigan homeowners deserve every possible legal protection against the devastating effects of mortgage fraud,” said Schuette. “I welcome reforms that will give prosecutors and law enforcement the tools they need to crack down on mortgage fraud and protect homeowners.”

Schuette reminds Michigan homeowners that citizens do not need to pay to speak with their lender or servicer, or to obtain outside assistance with foreclosure issues. Free local assistance with foreclosure issues can be found by calling the Michigan State Housing Development Authority at (866) 946-7432.

Schuette noted that Michigan’s Credit Services Protection Act prohibits the charging of upfront fees for mortgage services. Schuette urges any consumers who paid upfront fees to an individual or mortgage modification company for services that were not provided to file a consumer complaint online with the Attorney General’s Consumer Protection Division online at www.Michigan.gov/ag.

Allison Tussey

Posts Google+

2 responses to Michigan Legislation Aimed at Combatting Mortgage Fraud

  1. To Whom This May Concern:

    My husband and I purchased property from his father he insisted on doing the survey, so we aloud him to do so, trusted him. Paid cash for property, paid cash for ¾ of the building process.

    Went through the red tape and started the building of our new home, we ended up getting a mortgage to finish the home. During the application, I was asked for a driveway easement paper from the construction loan people, from my father in law, I questioned this, and I was told it was all right just get it so we can get this done.

    Mean while my husband and I both lost our jobs, hired a realtor to sell the home, the first month we were at our new location, the realtor had a promising bid on the house. She went through the paper work to get it started and she found that the house set on the wrong property, called the father in-law and he refused to sign over anything.

    Because we could not sell, it went into foreclosure, we have on our record that we abandoned the place, this has done severe credit damage!

    How can they put a foreclosure and abandonment on my credit on a house that I never owned?

    Should The Father in law, Title Company, Construction Loan Company, Mortgage company, County, and Township be obligated to give us restitution on this situation?

    Is there any help we can get on this situation?

    We know this was intent, we can prove it was?

    Feeling Hopeless……Kim

  2. The State of Michigan is finally going to close the barn door after the horse is already 25 miles down the road. Way too little and far too late.

Leave a Reply

Text formatting is available via select HTML.

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>