2012 Senate Bill 992 / Public Act 67

Clarify mortgage loan contract “non-recourse” provision rules

Introduced in the Senate

Feb. 29, 2012

Introduced by Sen. Arlan Meekhof (R-30)

To clarify that mortgage loan contracts that contain “non-recourse loan provisions” cannot be made into a recourse loan by a “post closing solvency covenant" or other device. Practically all residential mortgages are “non-recourse” loans, meaning that although the lender can take back the home, he can’t go after (“have recourse to”) a delinquent borrower’s other property or income.

Referred to the Committee on Economic Development

March 1, 2012

Reported without amendment

With the recommendation that the bill pass.

March 6, 2012

Amendment offered

To clarify that the bill provisions affect existing "non-recourse" loans as well as future ones, and make other technical changes.

The amendment passed by voice vote

March 7, 2012

Passed in the Senate 33 to 5 (details)

Received in the House

March 7, 2012

Referred to the Committee on Commerce

March 13, 2012

Reported without amendment

Without amendment and with the recommendation that the bill pass.

March 20, 2012

Passed in the House 97 to 12 (details)

To clarify that mortgage loan contracts that contain “non-recourse loan provisions” cannot be made into a recourse loan by a “post closing solvency covenant" or other device. Practically all residential mortgages are “non-recourse” loans, meaning that although the lender can take back the home, he can’t go after (“have recourse to”) a delinquent borrower’s other property or income.

Signed by Gov. Rick Snyder

March 29, 2012