HOUSE BILL No. 5864 May 14, 1998, Introduced by Reps. Dobronski, Freeman, Alley and Wallace and referred to the Committee on Local Government. A bill to amend 1846 RS 65, entitled "Of alienation by deed, and the proof and recording of convey- ances, and the canceling of mortgages," by amending section 25 (MCL 565.25), as amended by 1996 PA 526. THE PEOPLE OF THE STATE OF MICHIGAN ENACT: 1 Sec. 25. (1) In the entry book of deeds, the register shall 2 enter all deeds of conveyance absolute in their terms, and not 3 intended as mortgages or securities, and all copies left as 4 cautions. In the entry book of mortgages the register shall 5 enter all mortgages and other deeds intended as securities, and 6 all assignments of any mortgages or securities. In the entry 7 book of levies the register shall enter all levies, attachments, 8 liens, notices of lis pendens, sheriffs' certificates of sale, 9 United States marshals' certificates of sale, other instruments 10 of encumbrances, and documentation required under subsection (2), 06281'98 LBO 2 1 noting in the books, the day, hour, and minute of receipt, and 2 other particulars, in the appropriate columns in the order in 3 which the instruments are respectively received. 4 (2) Except as otherwise provided in subsection (3), the 5 REGISTER OF DEEDS SHALL NOT RECEIVE FOR recordingofa levy, 6 attachment, lien, lis pendens, sheriff's certificate, marshal's 7 certificate, or other instrument of encumbrancedoes not perfect8the instrument of encumbranceON REAL OR PERSONAL PROPERTY OF 9 ANOTHER unless THE PERSON PRESENTING IT PRESENTS both of the 10 following:are found by a court of competent jurisdiction to11have accompanied the instrument when it was presented to the reg-12ister for entry:13 (a) Afull and fair accounting of the facts that support14recording of the instrument of encumbrance and supporting docu-15mentation, as availableCOMPLETE LEGAL DESCRIPTION OF THE PROP- 16 ERTY UPON WHICH THE LIEN IS BEING FILED. 17 (b) Proof of service that actual notice has been given to 18 the recorded landowner of the land to which the instrument of 19 encumbrance applies. 20 (3) Subsection (2) does not apply to any of the following: 21 (a) A tax lien that is not required to be recorded pursuant 22 to the general property tax act,Act No. 206 of the Public Acts23of 1893, being sections 211.1 to 211.157 of the Michigan Compiled24Laws1893 PA 206, MCL 211.1 TO 211.157. 25 (b) The filing of an instrument of encumbrance authorized by 26 state statute or federal statute. 06281'98 3 1 (c) The filing of a consensual agreement to encumber real 2 property entered into between the owner of real property and the 3 person who seeks to record an encumbrance. A consensual agree- 4 ment includes but is not limited to a mortgage, loan agreement, 5 land contract, or other consensual or contractual agreement of 6 whatever description entered into between the owner of real prop- 7 erty and the person who seeks to record an encumbrance. 8 (d) The filing of an encumbrance authorized in a final order 9 by a court of competent jurisdiction. 10 (e) A filing of a levy, attachment, lien, lis pendens, 11 sheriff's certificate, marshal's certificate, or other instrument 12 of encumbrance by a commercial lending institution. As used in 13 this section, "commercial lending institution" means any of the 14 following: 15 (i) A state or nationally chartered bank. 16 (ii) A state or federally chartered savings and loan associ- 17 ation or savings bank. 18 (iii) A state or federally chartered credit union. 19 (iv) Any other state or federally chartered lending institu- 20 tion or regulated affiliate or regulated subsidiary of any entity 21 listed in this subparagraph or subparagraphs (i) to (iii). 22 (v) An insurance company authorized to do business in this 23 state pursuant to the insurance code of 1956,Act No. 218 of the24Public Acts of 1956, being sections 500.100 to 500.8302 of the25Michigan Compiled Laws1956 PA 218, MCL 500.100 TO 500.8302. 26 (vi) A motor vehicle finance company subject to the motor 27 vehicle sales finance act,Act No. 27 of the Public Acts of the06281'98 4 1Extra Session of 1950, being sections 492.101 to 492.141 of the2Michigan Compiled Laws1950 (EX SESS) PA 27, MCL 492.101 TO 3 492.141, with net assets in excess of $50,000,000.00. 4 (vii) A foreign bank. 5 (viii) A retirement fund regulated pursuant to state law, or 6 a pension fund of a local unit of government or a pension fund 7 regulated pursuant to federal law with net assets in excess of 8 $50,000,000.00. 9 (ix) A federal, state, or local agency authorized by law to 10 hold a security interest in real property or a local unit of gov- 11 ernment holding a reversionary interest in real property. 12 (x) A nonprofit tax exempt organization created to promote 13 economic development in which a majority of the organization's 14 assets are held by a local unit of government. 15 (xi) An entity within the federally chartered farm credit 16 system. 17 (xii) A licensee under the mortgage brokers, lenders, and 18 servicers licensing act,Act No. 173 of the Public Acts of 1987,19being sections 445.1651 to 445.1684 of the Michigan Compiled20Laws1987 PA 173, MCL 445.1651 TO 445.1684. 21 (xiii) A holder under the home improvement finance act,Act22No. 332 of the Public Acts of 1965, being sections 445.1101 to23445.1431 of the Michigan Compiled Laws1965 PA 332, MCL 445.1101 24 TO 445.1431. 25 (xiv) A retail seller under the retail installment sales 26 act,Act No. 224 of the Public Acts of 1966, being06281'98 5 1sections 445.851 to 445.873 of the Michigan Compiled Laws1966 2 PA 224, MCL 445.851 TO 445.873. 3 (xv) A licensee underAct No. 125 of the Public Acts of41981, being sections 493.51 to 493.81 of the Michigan Compiled5Laws, pertaining to secondary mortgagesTHE SECONDARY MORTGAGE 6 LOAN ACT, 1981 PA 125, MCL 493.51 TO 493.81. 7 (xvi) A licensee under the consumer financial services act, 8Act No. 161 of the Public Acts of 1988, being sections 487.20519to 487.2072 of the Michigan Compiled Laws1988 PA 161, 10 MCL 487.2051 TO 487.2072. 11 (xvii) A licensee under the regulatory loan act of 1963, 12Act No. 21 of the Public Acts of 1939, being sections 493.1 to13493.26 of the Michigan Compiled Laws1939 PA 21, MCL 493.1 TO 14 493.26. 15 (xviii) A regulated lender under the credit reform act,Act16No. 162 of the Public Acts of 1995, being sections 445.1851 to17445.1864 of the Michigan Compiled Laws1995 PA 162, MCL 445.1851 18 TO 445.1864. 19 (4) The instrument shall be considered as recorded at the 20 time so noted and shall be notice to all persons except the 21 recorded landowner subject to subsection (2), of the liens, 22 rights, and interests acquired by or involved in the 23 proceedings. All subsequent owners or encumbrances shall take 24 subject to the perfected liens, rights, or interests. 25 (5) A person who is not exempt under subsection (3) who 26 encumbers property through the recording of a document listed 27 under subsection (2) without lawful cause with the intent to 06281'98 6 1 harass or intimidate any person is liable for the penalties set 2 forth in section 2907a of the revised judicature act of 1961, 3Act No. 236 of the Public Acts of 1961, being section 600.2907a4of the Michigan Compiled Laws1961 PA 236, MCL 600.2907A. 06281'98 Final page. LBO