Banks must meet with delinquent borrowers before foreclosing

 From: http://www.housekeepingreport.com By  June 5, 2013

On June 3, Governor John Kitzhaber signed SB 558 into law. SB 558 closes the loophole that allowed lenders to avoid mediation with a borrower facing foreclosure if the lender intended to foreclose judicially. The new law also streamlines the process and incorporates lessons learned during the first year of operation, recommendations from stakeholders, and best practices developed in similar programs across the nation.

The new program, now dubbed the Foreclosure Avoidance Facilitation Program, will become operative on August 4, 2013. In the meantime, the Department of Justice has begun the process of revising the administrative rules to conform to the statutory changes, while the service provider, Oregon Housing and Community Services, and Legal Aid are planning supplemental trainings for housing counselors, attorneys, and facilitators.

In the meantime, expect to see an uptick in new filings as lenders rush to foreclose before the current loophole closes.

For more information about SB 558, read an overview here.

For more information about the relaunch, read DOJ’s press release here.

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One comment

  1. […] While this ruling does appear to hint at the potential for nonjudicial foreclosure proceedings to pick up, the State of Oregon recently passed Senate Bill 558, which goes into effect in August 2013. SB 558 requires banks to engage the borrower in mediation before they can initiate a judicial or nonjudicial foreclosure. You can read more about the revamped Foreclosure Mediation Program here: Banks must meet with delinquent borrowers before foreclosing […]

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