Gov. Snyder signed legislation on Friday to help Michigan homeowners avoid foreclosure.
The Legislation was sponsored by Sen. Darwin Booher, R-Evart.
"The impact of a foreclosure on the family and the entire community is devastating," said Booher. "The psychological and financial effect on families is long-lasting and profound."
Booher also mentioned that foreclosure can depress home values, which "reduces funding for schools and local governments and drives away job providers."
"By helping homeowners keep their homes, we can have a positive impact of struggling families and our economy," the Senator said.
In the aftermath of the 2008 banking and housing crisis, many lenders were unwilling to modify mortgages, which would have helped avoid foreclosure.
In 2009, Michigan responded by passing a 90-day mortgage foreclosure moratorium where the homeowner could work with lenders or could petition the courts to find a solution. This law was set to expire today.
The new bill extends the residential mortgage loan modification program until June 30th, 2013.
"Homeownership is at the heart of the American dream, and my reform is about helping to preserve that dream," said Booher, the chair of the Senate Banking and Financial Institutions Committee. "I sponsored this initiative because extending this foreclosure prevention program will protect homeowners while giving us six months to review and respond to new federal rules to be issued in January."
The rules to which Booher is speaking are the federal Consumer Financial Protection Bureau's rules that pertain to mortgage loan service. These rules were proposed in August, and after public comment that ended in October, are expected to be announced in January.