- January 29, 2015
- All Michigan Issuing Offices
- UNDERWRITING - Public Acts 429 of 2014 and 561 of 2014 / Special Assessments
Please be advised that on December 29, 2014, the Governor of Michigan signed into law Public Act 429, and on January 15, 2015, signed into law Public Act 561 which laws have been given an effective date of January 15, 2015 (copies attached). This legislation was designed to remove the problem created by the priority of deferred municipal tax assessment payments over the lien of mortgages.
Historically, special assessments were a lien on the property at the date of assessment for the entire amount of the assessment notwithstanding that the assessment could be paid as a "deferred assessment" allowing for annual payments (installments) over a period of years. This necessitated either a requirement on title work for payment of the entire assessment or an exception for the assessment in Schedule B and the issuance of a modified first lien letter.
Sections 7 and 8 of the new Acts provide: If the township board provides that a special assessment is payable in installments, the amount of any lien on the parcel of property assessed for that special assessment is limited to each individual installment and shall not attach to the property assessed until that individual installment is due.
Now as a result of this legislation, it is no longer necessary to require the payment in full of the entire special assessment on the commitment. You are simply required to make sure all assessment payments are current at the date of closing and we may insure without an exception for the assessment.
If you have any questions relating to this or other bulletins, please contact a Stewart Title Guaranty Company underwriter.
For on-line viewing of this and other bulletins, please log onto www.vuwriter.com.
THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.