Safeguard Properties

Property Maintenance Bill Proposed in New York

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Legislation Update
January 3, 2018

S07167 Summary

BILL NO S07167
 
SAME AS No Same As
 
SPONSOR KLEIN
 
COSPNSR AVELLA, BAILEY, HAMILTON, PERALTA, SAVINO, VALESKY
 
MLTSPNSR 
 
Amd §§1307, 1308 & 1310, RPAP L
 
Directs the department of financial services to periodically inspect residential real properties for which a lender has a duty to maintain; authorizes the department of financial services or the municipality to impose a $500 a day civil penalty for the failure of a lender to maintain an abandoned property that it has a duty to maintain; requires such lenders to register with the statewide vacant and abandoned property electronic registry.

Source: New York State Assembly (SB 7167 full text)

Additional Resource:

The Real Deal (Why thousands of New Yorkers’ property values are depressed by a total of $53M)

Massachusetts Appeals Court Clarifies Demand Letter Ruling

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Industry Update
January 25, 2018

Editor’s note: This story was originally featured in the January issue of DS News, out now.

Recently, in U.S. Bank, National Association as Trustee v. Milan, the Massachusetts Appeals Court provided further clarification on when the Pinti rule may be inapplicable. As those who are familiar with recent Massachusetts case law may recall in Pinti v. Emigrant Mortgage, Co., the Massachusetts Supreme Judicial Court in 2015 ruled that a foreclosure would not be valid if the demand letter required by the mortgage did not strictly comply with the mortgage provisions. So as to not invalidate foreclosures that had already occurred, the Pinti court held that it applied prospectively to new foreclosures or to any previous foreclosure so long as the demand letter issue had been raised in a court action before Pinti was decided.

In Milan, the Appeals Court held that a Pinti defense was not timely raised where the plaintiff fully set forth a challenge to the foreclosure sounding in forgery but failed to plead any specific Pinti challenge prior to July 17, 2015. A copy of the decision in Milan can be found by clicking here.

The plaintiff in Milan commenced the underlying action in 2012 seeking to evict the defendants following a foreclosure on the subject property. At the outset of the eviction action, defendants filed a form answer on which they checked a box indicating that plaintiff did not have a “superior right of possession.” During discovery, defendants disclosed that their defense challenging plaintiff’s right to possession flowed from alleged forgery at origination. In fact, all pleadings filed by defendant’s counsel prior to the Pinti decision (July 17, 2015) presented a defense based on forgery only. It was not until after the Massachusetts Supreme Judicial Court issued its decision in Pinti that defendant’s counsel amended defendants’ answer to include a claim that plaintiff failed to

strictly comply with the terms of the mortgage prior to acceleration. The Northeast Housing Court dismissed plaintiff’s complaint pursuant to Pinti and plaintiff appealed.

The Appeals Court decision in Milan comes after the Massachusetts Supreme Judicial Court issued another decision in Federal National Mortgage Association v. Marroquin which allowed the Pinti decision to be applicable to all cases where a defense based on failure to strictly comply with the acceleration requirements of the mortgage was properly raised prior to July 17, 2015. As such, the decision in the instant case is limited to whether a Pinti defense was timely raised in the lower court. The Appeals Court declined to decide whether checking a box on a form answer challenging plaintiff’s right to superior possession alone is enough to properly raise a Pinti defense. Instead, the court focused on defendants’ responses to discovery and pleadings filed after their answer. Each such pleading specified the basis of their defense sounded in forgery and neglected to specify any defense resembling a Pinti defense. In a footnote, the Milan court stated: “We reject the Milans’ contention that their amended answer should be treated as having raised the Pinti claim because, under Mass.R.Civ.P. 15(c), 365 Mass. 761 (1974), it ‘related back’ to the date of their original answer. For purposes of Marroquin, the issue is not whether the claim ‘relates back’ but whether U.S. Bank was placed on notice of the claim in real-time before the date established in Pinti for applicability of the Pinti rule.”

Practically, this decision will be helpful to local counsel that have been responding to a myriad of new arguments from former owners attempting to expand the applicability of the Pinti rule.

Source: DS News

Maryland Case Puts the Brakes on Foreclosures

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Industry Update
January 24, 2018

Editor’s note: This story was originally featured in the January issue of DS News, out now.

On June 6, 2017, the Court of Special Appeals, Maryland’s intermediate appellate court, issued an opinion in the combined cases of Blackstone v. Sharma, Sept. 2015 No. 1524, and Shanahan v. Marvastian, Sept. 2015, 1525. This case arose out of challenges filed in two foreclosure cases docketed there and can conservatively be said to have sent shock waves through some servicers and their attorneys in the state.

The case has resulted in hundreds, if not thousands of foreclosure cases being placed on hold, with their futures uncertain. Specifically, the Court of Special Appeals upheld the dismissal of two foreclosure actions initiated on behalf of a Delaware Statutory Trust (DST) because the DST was not a licensed collection agency pursuant to the Maryland Collection Agency Licensing Act, Md. Code, Bus. Reg. § 7-101, et seq. (“MCALA”). It also held that any judgment entered as a result of the foreclosure actions would be void. In declaring such matters void, as opposed to merely voidable, the court has cast a cloud on the title of potentially thousands of foreclosures that have been completed since MCALA was enacted in 2007. While MCALA has numerous exceptions (including for licensed banks, credit unions, and mortgage lenders), the licensing requirement applies “whenever the person does business as a collection agency in the State.” Md. Code, Bus. Reg. § 7-301(a). Although it also contains an exception for trust companies, the court here explicitly found that the type of trust in question did not meet the criteria of “trust company.” Notably, MCALA also does not apply if the debt in question was not in default at the time it was acquired.

In the wake of this opinion, numerous foreclosures already in process were put on hold, and many new cases were not filed while servicers and attorneys scrubbed files to ascertain if the licensing requirement was applicable. Further, many sales that had already been ratified but where the trustee’s deed had not been recorded were also put on hold, thereby also putting many REO transactions in jeopardy. Many owners of these mortgage loans also have had to set up special entities to transfer loans specifically for the purpose of being able to obtain the license.

On November 30, 2017, the Maryland Court of Appeals (Maryland’s highest appellate court) heard oral argument on the appeal filed in response to this opinion, as well as two related cases taken directly on appeal from the circuit court as to the applicability of MCALA to foreclosure proceedings. It is unclear when the Court of Appeals will issue its opinion in the matter.

In the meantime, files will stay on hold, and unpaid defaulted loans will continue to weigh on servicers’ and debt owners’ operations. Needless to say, all of the affected parties are anxiously awaiting the outcome of the Court of Appeals ruling.

Source: DS News

Legal Update: Focus on FEMA and Foreclosures

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Industry Update
January 31, 2018

Editor’s note: This story was originally featured in the January issue of DS News, out now.

During the week of September 4, 2017, most Floridians sought shelter and boarded homes and businesses in anticipation of a direct hit by then-Category 5 Hurricane Irma. The path of the hurricane appeared to swallow the entire state, threatening each coast and all counties in between.

Default law firms, especially those with a footprint extending to Texas, were acutely aware of the risk to business posed by such a storm. Hurricane Harvey had just made landfall in Houston two weeks earlier, and firms saw nearly all default-related processes, referrals, and services grind to a halt in the impacted region. While effectuating business continuity plans and relocating key staff to maintain business operations during the approaching storm, firms and servicers alike contemplated the impact of a statewide natural disaster, and began preparing worst-case scenario contingency plans.

The Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 et seq.) gives the President the authority to declare a national disaster for any area affected by a hurricane. Whenever such a disaster is declared, mortgagees must, among other mitigationrelief options, immediately implement a moratorium on foreclosures in accordance with HUD guidelines for the duration of 90 days. This applies to the initiation of foreclosures, as well as to foreclosures already in process.

In the days following Hurricane Irma, 70-80 percent of default volume was placed on  hold, and new referrals were arrested. Firms immediately reduced and reallocated staff to offset anticipated losses, and began creatively exploring additional fee opportunities presented by the circumstances, namely in the form of hearing and sale continuances.

Firms also proactively contacted the major servicers in an effort to carefully outline various exceptions carved out of the moratorium. For example, to be included in the moratorium, subject properties must have been occupied and directly affected by the disaster. Firms implored servicers to send property inspection teams to counties known to be less impacted by the storm. Reputational risk, however, deterred most mortgagees from taking this approach. Servicers preferred to cautiously maintain FEMA holds on all government-backed loans for the duration of the 90 days.

Florida judiciaries, conversely, felt no obligation to honor the moratorium, and took a more aggressive approach. In Florida, the continuation of a hearing or sale is left to the discretion of the judge. Many counties and individual judges refused to grant firms’ requests for hearing, trial, and sale continuances based on FEMA holds without actual evidence of property damage. To avoid entry of judgment and auction sales in such cases, servicers were compelled to conduct property inspections to confirm whether damage existed. In some cases, servicers may not have had the opportunity to order an inspection in a timely manner, and may have proceeded with the foreclosure of an impacted property, the very sin mortgagees sought to cautiously avoid.

In hindsight, servicers may have been better able to satisfy the spirit of the moratorium by taking the time and resources to inspect for damage during the course of the moratorium. Given the scope of the holds, servicers could have mitigated costs by focusing inspection efforts on properties with upcoming hearing, trial, and sale dates. Mortgagees would have been better prepared to respond to judiciaries anxious to avoid year-end docket backlogs, and would have proactively identified those at-risk properties and mortgagors whose protection the moratorium truly sought to secure. The circumstances presented to the default industry in the state of Florida by Hurricane Irma proved that the cautious approach may not always produce the intended result, especially in the context of a natural disaster impacting an entire judicial foreclosure state.

Source: DS News

Housing Transition Team Advises Murphy: First, Acknowledge the Crisis

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Industry Update
January 31, 2018

Report lays out six priorities to increase housing stock and end foreclosures, does not call for COAH to be resurrected

Gov. Phil Murphy’s Housing Transition Advisory Committee recommends that he acknowledge New Jersey has a housing crisis and set six priorities for increasing New Jersey’s housing stock and keeping people in their homes, none of which includes a reconstitution of the state Council on Affordable Housing.

The report is one of 14 issued by the Murphy administration, after it created numerous transition committees seeking their recommendations. The transition committees were made up of stakeholders in the particular areas — nonprofits, citizen advocates, business interests, and so forth. The report takes on key issues facing the Garden State, including affordable housing and foreclosures.

The first and overarching recommendation of the housing committee’s 14-page report, which advocates praised, is that Murphy reinstate the position of senior deputy commissioner of housing in the Department of Community Affairs and the Statewide Commission on Housing, which were created by the Fair Housing Act of 2008 but never constituted by the Christie administration. These would be dedicated to better addressing the state’s housing needs.

No comeback for COAH

But since it did not call for resurrecting COAH, the report seems to hammer the last nail into the coffin of the former agency that was hated by Democrats and Republicans alike. Instead, the report urges the continuance of the current process, in which judges are approving municipal affordable-housing obligations. The Statewide Housing Commission is eventually expected to recommend a new administrative method for overseeing how to set affordable housing goals and see that towns comply with their constitutional mandate to provide a share of the statewide need for homes for those of low and moderate incomes.

“Once the court process is complete, the next iteration of an administrative agent must be in place,” the report states. “This will provide time for the commission to explore the optimal administrative agent and process to govern municipal fair-share requirements in New Jersey.”

Michael Cerra, assistant executive director of the New Jersey State League of Municipalities, said not recommending a replacement for the current court process, which he termed “dysfunctional, costly, ineffective and inefficient” for towns, is the report’s greatest missed opportunity.

“The state has vacated the playing field, both the Legislature and the previous administration,” Cerra said of inaction on affordable-housing rules. “This was certainly an opportunity to contemplate how administrative functions could re-engage, but instead it downplays and punts on that issue.”

Construction already underway

The Fair Share Housing Center, which has been a party to these court cases and settlements and whose executive director was a member of the transition committee, disagrees. Spokesman Anthony Campisi said that 180 municipalities have agreed to zone for 60,000 homes through the process and that construction already has begun on some projects.

“Shovels are in the ground in many of these communities,” Campisi said. “To stop the process now would cause delay. The courts are giving us real results. The report concludes this process should continue. As to what’s next, we’d like to be included in any of these conversations.”

Municipalities have been obliged to provide for their share of the regional need for affordable housing for decades, following the state Supreme Court’s first and subsequent decisions that are known collectively as the Mount Laurel doctrine after the Burlington County township whose exclusionary zoning sparked the first cases. New Jersey’s Fair Housing Act established a mechanism for doing that and COAH to oversee that. But the Supreme Court took the responsibility away from the council after it failed numerous times to adopt satisfactory rules.

The report urges the creation of an overarching housing policy to most efficiently breach the barriers to improving affordability, which federal tax changes will only exacerbate.

Housing in crisis

It agrees with other reports released last year that termed New Jersey’s housing situation in crisis. About four in 10 households here struggle to pay housing and other costs and the state needs 150,000 new affordable homes immediately and a way to ensure the ongoing production of more units, according to the report.

“This housing crisis undermines the governor’s goal of a stronger and fairer economy and contributes to the exodus of families, millennials, and seniors,” it states. “In the past eight years, this housing crisis has not been a State priority. In fact, funds to support the development and preservation of affordable homes have been re-allocated to the general treasury, exacerbating the housing problem. This has led to disjointed programs scattered across multiple departmental divisions attempting to fill gaps.”

A more robust state housing program should identify funding sources, streamline programs, consolidate funding opportunities in the New Jersey Housing and Mortgage Finance Agency, and work with local public-housing authorities both on creating more affordable housing and preventing people from losing their homes through foreclosure.

Incentivizing the production of housing is another priority the report recommends. It suggests tripling the Neighborhood Revitalization Tax Credit cap from $10 million to $30 million as a way to get businesses to invest in housing, commercial and mixed-use projects. According to the Housing and Community Development Network of New Jersey, the program has so far leveraged $9 from private and public sources for every $1 tax credit given and it has resulted in the construction of more than 1,200 homes and 350,000 square feet of commercial space.

The state should also use grants from the Economic Development Authority to support moderate-income housing construction and reorganize the NJHMFA to make it a “one-stop shop” for housing programs.

With the highest foreclosure rate in the nation, New Jersey should aggressively work to keep people from losing their homes, the report states. It recommends Murphy start by reversing several Christie positions that prevented the state from effectively battling the problem. For instance, it suggests Murphy take action to work with local organizations to turn foreclosed homes into affordable housing — Christie vetoed a bill that sought to do that three times. It also seeks the codification of a mediation program to help homeowners avoid foreclosure and suggests that it be funded by a temporary $800 surcharge on each foreclosure complaint filed in the state, to be paid by the lender.

To help pay for foreclosure programs, and perhaps other housing programs, New Jersey should be aggressive in pursuing all federal settlements with financial institutions resulting from their roles in foreclosure actions, which the report estimates could total as much as $600 million for the state that has not been pursued.

Other areas the report states should be priorities are:

  • Reduce barriers to creating housing by streamlining approvals for inclusionary developments, remove other barriers to construction and providing greater planning support to municipalities.
  • Provide legal assistance to those facing eviction or foreclosure by implementing a pilot program to give representation to those threatened with a loss of their homes and to enforce anti-discrimination laws.
  • End homelessness by restructuring programs that help the homeless, making it a priority to provide permanent, supportive housing to all in need, increasing fees to fund county or a statewide Homeless Trust Fund to pay for shelters, and banning the blacklisting of tenants who had a prior housing court appearance.

Housing advocates like Staci Berger, the president of HCDNNJ, were pleased with the simple idea of a governor who is serious about housing issues but they also support the report’s recommendations.

“We are looking forward to working with the administration to accomplish the priorities presented in the report to making New Jersey a place everyone can afford to call home by addressing foreclosure and homelessness prevention, tenants’ rights, expanding the Neighborhood Revitalization Tax Credit Program, and of course creating more affordable choices for all residents,” Berger said.

Source: NJ Spotlight

Additional Resource:

New Jersey Housing Transition Advisory Committee (Report of the Housing Transition Advisory Committee)

House Bill Targets Owners of Blighted Properties

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Legislation Update
January 31, 2018

A bill introduced in the Ohio House would speed up legal action against landlords who own blighted properties that become magnets for crime.

State Rep. Adam Miller, D-Columbus, says the “Blight Bill” is aimed at addressing problems that continue to plague declining neighborhoods in Columbus and the rest of Ohio.

“Unfortunately, it’s all too common,” Miller said of blight. His House district includes the city’s West and South sides, where he said community members tell him that their No. 1 concern is abandoned and blighted properties, which sometimes become drug or prostitution houses.

“We have to do something about it,” Miller said. “You get after urban blighted properties, you deprive criminals of their hotbed drug sales, illicit prostitution, all of the criminal activity that goes with it,″

If adopted, the measure would allow cities to file civil actions against landlords with blighted, subsidized properties 30 days after they receive a notice, versus the current 60 days. Judges also would be able to hold hearings on complaints 14 days after the owner of a building is served with a complaint. Now, it’s 28 days.

Also, a property owner would have to comply with an injunction requiring the abatement of a nuisance in 14 days instead of 30 days. Violations would be a first-degree misdemeanor.

“This is not an issue for the responsible landlord,” Miller said. “This bill is aimed at the often out-of-town, out-of-state landlord who could really care less.”

Miller has discussed the bill with Columbus City Council and the city attorney’s office. Meredith Tucker, a spokeswoman for that office, said it is reviewing the draft.

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P. Scott Lipps, R-Franklin, in southwestern Ohio, is co-sponsoring the bill, Miller said.

The original bill would have established a state-funded “Local Blight and Nuisance Abatement Fund” to allow local municipalities to boost enforcement and pay for cleanups. But Miller said he wanted to concentrate on the other elements of the bill first.

“I want to focus on the heart of the problem,” he said.

The bill will be referred to an Ohio House committee for hearings. Miller said he has not yet received any pushback.

Janet Capaldi, a central Hilltop resident for six years, said something more needs to be done to stem the crime problems connected to blighted properties. She said it takes too long now to deal with problem landlords.

“I’m sure it’s because of the volume of complaints. The problem is huge. We don’t have enough police and code officers. Everything takes so long,” said Capaldi, a Cleveland-area native who bought a house in the Hilltop because it was affordable.

Lisa Boggs, a Hilltop neighborhood leader, said Miller’s proposal is workable.

“I’m excited about it,” she said. “The quicker they speed the process up, the more cases the city attorney can take.”

Other cities are trying to tighten up their own blight laws. In January, the Baltimore City Council introduced legislation that called for licensing and inspecting all residential rental properties, according to the Baltimore Sun. Landlords who comply with regulations and quickly fix violations would get licenses that require inspections every three years. Landlords who don’t would need to have their properties inspected every two years.

Baltimore, with an estimated population of 614,664, has 93 housing inspectors. Columbus, with a population of 860,090, has 66 code-enforcement officers, including supervisors.

Source: The Columbus Dispatch

Additional Resources:

Ohio Legislature (HB 482 full text)

Baltimore City Council (Ordinance 18-0185 info)

Expedited Foreclosure Bill Introduced in New Jersey

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Legislation Update
January 25, 2018

New Jersey
SB 1243

Summary

Concerns expedited process for foreclosing vacant and abandoned residential properties in uncontested actions.

NOTE: An identical Assembly bill, AB 2085, is pending in the Assembly Housing and Community Development Committee.

Source: New Jersey State Legislature (SB 1243 full text)

Additional Resource:

Safeguard Properties Fast-Track Legislation Resource Center

Erie County Clerk Rolls Out Program to Alert Communities to Foreclosures

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Industry Update
January 5, 2018

Erie County Clerk Michael P. Kearns has come up with a new initiative to combat two of the biggest problems that contribute to “zombie homes” — homes that have been abandoned by owners during the lengthy foreclosure process but have not been been taken over by banks.

For too long, communities have not found out about the properties in foreclosure early enough to prevent their abandonment, and homeowners haven’t understood their rights and the free resources available to them when they fall behind on their mortgage payments, he said.

Kearns’ program will enable cities, towns and villages to have direct access to Erie County Clerk’s Office databases showing all new foreclosure actions in their communities since the start of January.

The information will not only include property addresses, but the name of the bank foreclosing on the property, and the name of the lawyer handling the legal process. That information will allow communities to take action early to keep properties from turning into “zombies,” he said.

“This is not being done anywhere else in New York State,” he said.

In addition, homeowners facing foreclosure will receive a letter signed by Kearns and the head of the Western New York Law Center outlining their rights in the foreclosure process and all available resources they can turn to for help.

“There are options for people, but if people don’t know what their options are, they aren’t going to make good decisions,” he said. “Many times, they’re going to leave the property, and that’s how zombie properties get created.”

Kearns will unveil the new program on Friday, just weeks into his new job as county clerk. He’s calling the program ALERT — short for Accessing Lis Pendens Data for Erie County and Reporting to Towns, Cities and Villages.

The new program builds on the work Kearns did as a state assemblyman fighting zombie homes.

Given his office’s access to vast amounts of data, being able to leverage foreclosure information to help communities is important, Kearns said.

Originally, he said, the provider who maintains the software used by his office told him there was no way to make this data available to municipal leaders. But working with the county’s Division of Information and Support Services, they were able to make it happen.

The Law Center will hold quarterly training sessions for community administrators who want to access the data, starting Jan. 29, said Kate Lockhart, the center’s foreclosure data manager. In addition, the agency will launch a new hotline to assist residents facing foreclosure action.

The County Clerk’s Office will make information available to communities and to residents. The Law Center will help administrators interpret the data, and give homeowners the guidance they need to make better decisions, Lockhart said.

The Law Center provides free legal services for those facing foreclosure thanks to funding from the State Attorney General’s Office. Lockhart pointed out that the foreclosure crisis that began a decade ago remains above normal compared with pre-recession times.

“This still isn’t normal, what we’re experiencing,” she said. “We’re just used to it.”

Source: The Buffalo News

Crackdown: Clearwater Plan Would Foreclose on Problem Properties

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Industry Update
January 4, 2018

CLEARWATER —Soon there will be no mercy shown to owners of dilapidated homes, notoriously unkempt lots and properties that chronically violate city codes.

The city of Clearwater for the first time is developing a policy to foreclose on properties with unpaid liens that are contributing to neighborhood blight. More than 140 properties have racked up a combined $18.6 million in liens, some as old as 11 years, city officials say.

Some owners owe just a couple thousand dollars for overgrown yards or strewn debris. But nearly half of the offenders face six-figure fines for everything from abandoned homes to unsafe structures. And sending notices of violation hasn’t exactly done the trick.

“Compliance is what we seek, and that’s all we ask for,” said Code Compliance Manager Terry Teunis. “There’s been years and years of blight and very little response from either the bank or property owner. It creates nuisances. You have vermin from overgrowth, or you have transients coming in and breaking in places. You have graffiti. It’s our obligation really.”

Teunis said he expects the policy to come up for a February vote by City Council, a required step before the city can take foreclosure action on properties. The city is modeling its program after the one launched in St. Petersburg in 2015 that so far has taken on 243 cases — 120 of which have resulted in properties being sold at auction, according to St. Petersburg Director of Codes Compliance Assistance Rob Gerdes.

St. Petersburg has collected $1.6 million through foreclosures or by violators paying up mid-process, Gerdes said. The money has gone into the city’s general fund, minus $520,000 paid to the Weidner law firm hired to handle the program.

Gerdes said the program got started due to an increasing number of vacant lots being abandoned across St. Petersburg. The city resorted to mowing grass on its own, demolishing structures and assessing fines that often eclipsed the value of properties.

“Once we foreclosed on our liens and the property got sold and the new owner had a clear title, the new owner would be motivated to maintain the property,” he said. “We’ve definitely seen less code cases after the foreclosure auction (started), so it’s working.”

Along with the 120 foreclosure sales, 45 violators have paid liens prior to getting foreclosed upon, 21 have reached special agreements like committing to construct homes on the vacant lots, and about 50 are still in the legal process, Gerdes said.

While almost all of St. Petersburg’s foreclosure cases have involved vacant lots, most of Clearwater’s code liens are on homes and structures.

Teunis said Clearwater’s policy will apply to properties with low or no mortgages and will likely not target homes occupied by residents.

The largest single outstanding fine is $915,000, accumulated since 2007 at 1334 Fairmont St. The single-story, blue paneled home has chairs, plastic containers, rusty appliances and other junk strewn across the yard, breaking the code against outdoor storage.

Owner Mona Wyllie could not be reached for comment.

The structure at 309 S Pegasus Ave. has $622,000 in liens racked up, with an overgrown yard and mismatched blue paint partially splattered over gray walls.

Clearwater will face a web of legal issues when foreclosing, including how to handle homes and properties once under city ownership. But like St. Petersburg, the city is expected to hire an outside firm to oversee the process.

“We just feel like we need something else because we’re not being effective through our liens,” Teunis said.

Source: Tampa Bay Times

Bill to Lower Foreclosure Process Gains Momentum

Posted on by Safeguard

Updated 6/19/18: PA HB 653 has been approved by Governor Tom Wolf.

Link to bill

Additional Resource:

DS News (Why the Pennsylvania Anti-Blight Bills Make Good Sense)

Updated 6/12/18:  PA HB 653 has been signed in the Senate and presented to the Governor.

Link to bill 

Legislation Update
January 29, 2018

HARRISBURG — A House-passed bill to speed up the foreclosure process for abandoned property is gaining traction in the Senate.

The Senate Appropriations Committee on Monday approved House Bill 653, which provides guidelines and timetables for municipal code officers, courts and lenders to get abandoned properties ready for sheriffs’ sales.

The bill heads to the Senate floor where an agreed-to amendment will be offered.

This amendment will address issues concerning the legal definition of abandoned property, said Sen. Sharif Street, D-Philadelphia.

The bill, sponsored by Rep. Kurt Masser, R-Northumberland, aims to shorten a foreclosure process that can now take between 300 days and 540 days to one lasting 240 days. Foreclosure occurs when lenders seize a property because owners can’t keep up with mortgage payments.

It would apply to property that meets criteria for being vacant and abandoned and for which a lender has given notice of a delinquent or defaulted obligation. The criteria currently include the property being vacant at the time of two municipal inspections 45 days apart and officials getting no response to a notice posted on the property for the owner to contact a code enforcement officer.

Under the bill, municipal code officers or judges would have authority to certify a property as vacant or abandoned before an expedited foreclosure could take place.

Once certification takes place, a sheriff could schedule a sale on that property within 60 days following the filing of a writ of execution.

Masser’s legislation is the product of a bipartisan task force of lawmakers who have won passage of a number of anti-blight laws during the past decade. One goal of the task force is to restore derelict and abandoned property to productive use.

Source: Altoona Mirror

Additional Resources:

Pennsylvania General Assembly (HB 653 full text)

Safeguard Properties Fast-Track Legislation Resource Center