Michigan Laws 445.1634 – Person making mortgage loan; prohibited conduct
Current as of: 2023 | Check for updates
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(1) A person offering to make or making a mortgage loan shall not do either of the following:
(a) Charge a fee for a product or service if the product or service is not actually provided to the customer.
Terms Used In Michigan Laws 445.1634
- Appraisal: A determination of property value.
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Mortgage loan: means a loan or home improvement installment contract secured by a first or subordinate mortgage or any other form of lien or a land contract that covers real property located in this state that is used as the borrower's principal dwelling and is designed for occupancy by 4 or fewer families. See Michigan Laws 445.1632
- Mortgage loan: A loan made by a lender to a borrower for the financing of real property. Source: OCC
- Person: means an individual, corporation, limited liability company, partnership, association, governmental entity, or any other legal entity. See Michigan Laws 445.1632
(b) Misrepresent the amount charged by or paid to a third party for a product or service.
(2) A lender in making a mortgage loan shall not finance as part of the loan single premium coverage for any credit life, credit disability, or credit unemployment.
(3) A person, appraiser, or real estate agent shall not make, directly or indirectly, any false, deceptive, or misleading statement or representation in connection with a mortgage loan including, but not limited to, the borrower’s ability to qualify for a mortgage loan or the value of the dwelling that will secure repayment of the mortgage loan.
(4) A lender shall not insert or change information on an application for a mortgage loan if the lender knows that the information is false and misleading and intended to deceive a third party that the borrower is qualified for the loan when in fact the third party would not approve the loan without the insertion or change.
(5) A statement or representation is deceptive or misleading if it has the capacity to deceive or mislead a borrower or potential borrower. The commissioner shall consider any of the following factors in deciding whether a statement or misrepresentation is deceptive or misleading:
(a) The overall impression that the statement or representation reasonably creates.
(b) The particular type of audience to which the statement is directed.
(c) Whether it may be reasonably comprehended by the segment of the public to which the statement is directed.
(6) A lender shall not condition the payment of an appraisal upon a predetermined value or the closing of the mortgage loan which is the basis of the appraisal.
(7) A person shall not directly or indirectly compensate, coerce, or intimidate an appraiser for the purpose of influencing the independent judgment of the appraiser with respect to the value of the dwelling offered as security for repayment of the mortgage loan.
(8) A mortgage loan note shall not contain blanks regarding payments, interest rates, maturity date, or amount borrowed to be filled in after the note is signed by the borrower.