Mortgage Loan Officer Legislation:
Senatebills 826-833 and House bills 5287-5291

The 13-bill legislation, which was approved April 3, gives the Office of Financial Services more oversight over the mortgage loan industry, establishes better guidelines regarding licensing and educational training, and creates a mortgage industry advisory board to help the OFIS better regulate the mortgage loan industry. Following are some of the new guidelines for mortgage loan officers:

All mortgage loan officers must register with the OFIS, effective January 2009.

All mortgage loan officers — unless employed as a loan officer for four and a half of the five previous years — are required to complete 24 hours of pre-licensure education and pass an initial exam.

All mortgage loan officers are required to complete six hours of continuing education per year.

All mortgage loan officers must undergo a background check.

For more information, visit www.Michigan.gov or www.mirealtors.com.

Principal Residence Exemption (PRE)
Legislation: Public Act 96

Public Act 96 was signed into effect on April 8.  The legislation allows homeowners to retain two principal residence exemptions, one for their current home and one for property that is still on the market one year after the homeowner has move elsewhere in the state. It is designed to help struggling sellers who have lost principal residence status on the property that’s for sale.  The deadline to apply for the 2009 tax year is May 1, 2009 — the deadline for 2008 has expired. Additional exemptions can be retained for up to three years if the following criteria are met: 

The property is not occupied.

The property is for sale.

The property is not leased or available for lease.

The property is not used for any business or commercial purpose.

The homeowner must reside in Michigan.

The homeowner must submit Form 4640 by May 1 of the tax year for which they are applying for exemption.

To reapply for the next tax year, homeowners must submit another Form 4640 by Dec. 31 of the initial year.

For more information or to download Form 4640, visit www.Michigan.gov/treasury. The Michigan Department of Treasury can also be reached at (517) 373-3200 or at TTY (517) 636-4999 for the deaf and hearing impaired.

Mortgage Appraisal Fraud
Legislation: Senate bills 342, 343, 356
and House Bills 4054, 6148

This legislation intends to prohibit coercing or inducing appraisers to inflate the value of mortgaged property and real property offered as collateral for secondary mortgage loans. It would also prohibit loan officers from coercing appraisers to inflate a home’s value and prohibit setting developing or communicating appraisals based on a certain outcome, among other restrictions. The legislation would set guidelines for criminal procedures. The package was approved by the Senate May 2 and referred to the Committee on Banking and Financial Institutions, which reported a recommendation and referred the package to a second reading May 27.  It is expected to pass soon.

For more information on this legislation, visit www.legislature.mi.gov.

Michigan Tax Tribunal: House bills 433-37

Recent amendments to the Tax Tribunal Act of 1973 were implemented May 8 to improve the efficiency, accessibility and effectiveness of the Michigan Tax Tribunal (MTT) and sets up an administrative court within the Department of Labor and Growth to hear disputes in both property and non-property related matters. 

Among other changes, it directs fee and charges to the MTT to fund the court, establishes guidelines for mediators, allows for mediation of property disputes, and expands the scope of hearings to be heard in small claims court — now, any residential property that has a state equalized value of less than $100,000 can be heard in small claims court as long as the damages do not exceed $6,000.  It also sets guidelines for appeals and start dates.

For more information on property tax appeals, visit www.Michigan.gov/taxtrib.