February 21, 2019, Introduced by Reps. Berman, Mueller, Wozniak, Love and Whitsett and referred to the Committee on Financial Services.
A bill to amend 1961 PA 236, entitled
"Revised judicature act of 1961,"
by amending section 3240 (MCL 600.3240), as amended by 2014 PA 431.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 3240. (1) A purchaser's deed under section 3232 is void
if the mortgagor, the mortgagor's heirs or personal representative,
or any person that has a recorded interest in the property lawfully
claiming under the mortgagor or the mortgagor's heirs or personal
representative redeems the entire premises sold by paying the
amount required under subsection (2) and any amount required under
subsection (4), within the applicable time limit prescribed in
subsections (7) to (12), to the purchaser or the purchaser's
personal representative or assigns, or to the register of deeds in
whose office the deed is deposited for the benefit of the
(2) The amount required to be paid under subsection (1) is the
amount that was bid for the entire premises sold, interest from the
date of the sale at the interest rate provided for by the mortgage,
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. Except as provided in subsection (14), the
register of deeds shall not determine the amount necessary for
redemption. The purchaser shall provide 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 of not more than
$200.00 as stated in the affidavit and may be authorized by the
purchaser to receive redemption money. 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 is void only
to the redeemed parcel or parcels.
(4) If, after a sale under section 3216, the purchaser, the
purchaser's heirs or personal representative, or any person
lawfully claiming under the purchaser or the purchaser's heirs or
personal representative 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
period of redemption,
redemption shall be made the property may
upon on payment
of the sum amount 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. This subsection does not apply unless
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
(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 has 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 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) Subject to section 3238, for a mortgage executed on or
after January 1, 1965, of 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) Subject to subsections (9) to (11) and section 3238, for a
mortgage executed on or after January 1, 1965, of residential
property not exceeding 4 units, 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 a mortgage of residential property not exceeding 4
units, if the property is abandoned as determined under section
3241, the redemption period is 1 month.
(10) 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
(11) Subject to section 3238, for a mortgage of property that
is used for agricultural purposes, the redemption period is 1 year
from the date of the sale.
(12) If subsections (7) to (11) do not apply, and subject to
section 3238, the redemption period is 1 year from the date of the
(13) The amount stated in any affidavits recorded under this
shall be is the amount necessary to satisfy the
requirements for redemption under this section.
(14) The register of deeds of a county with a population of
more than 750,000 and less than 1,500,000, at the request of a
person entitled to redeem the property under this section, shall
determine the amount necessary for redemption. In determining the
amount, the register of deeds shall consider only the affidavits
recorded under subsections (2) and (4). A county, register of
deeds, or employee of a county or register of deeds is not liable
for damages proximately caused by an incorrect determination of an
amount necessary for redemption under subsection (2).
(15) A register of deeds may charge not more than $50.00 for
determining the amount necessary for redemption under this section.
(16) For purposes of this section, there is a presumption that
the property is used for agricultural purposes if, before the
foreclosure sale under this chapter, the mortgagor provides the
party foreclosing the mortgage and the foreclosing party's attorney
proof that the mortgagor filed a schedule F to the mortgagor's
federal income tax form 1040 for the year preceding the year in
which the proceedings to foreclose the mortgage were commenced and
records an affidavit with the register of deeds for the county in
which the property is located stating that the proof has been
delivered. If the mortgagor fails to provide proof and record an
affidavit as required by this subsection before the foreclosure
sale, there is a presumption that the property is not used for
agricultural purposes. The party foreclosing the mortgage or the
mortgagor may file a civil action to produce evidence to rebut a
presumption created by this subsection. An action under this
shall subsection must be filed before the expiration of the
redemption period that would apply if the property is determined
not to be used for agricultural purposes.