MI SB0933

Prohibits licensees and registrants from transferring or assigning secondary mortgage loans before 75% or more of loan proceeds are disbursed to the borrower, with exceptions for land contracts, government programs, construction loans, and installment/renovation-based disbursements.

Requires licensees and registrants to disclose to loan applicants at the time of application whether the lender may assign, sell, or transfer loan servicing while the loan is outstanding.

Mandates written notice to borrowers of any assignment, sale, or transfer of servicing with at least 15 days advance notice (or 30 days after transfer in cases of contract termination for cause, bankruptcy, or conservatorship proceedings), including transferee contact information and details about payment acceptance dates.

Establishes criminal penalties of up to $15,000 in fines and 1 year imprisonment for willfully conducting secondary mortgage lending business without proper licensing, including coercing appraisers to inflate property values.

Creates civil liability allowing persons, prosecutors, or the attorney general to recover actual damages of at least $250 per violation (or $1,500 for servicing transfer violations), plus attorney fees and investigation costs.

Takes effect July 31, 2010.