Thursday, June 10, 2010

New foreclosure notice law for Oregon

(c) 2010 Benjamin D. Knaupp
Attorney at Law
Admitted in Oregon since 1997

On March 3rd of this year, Governor Ted Kulongoski signed into law a bill that will affect foreclosing lenders in Oregon.

The law is House Bill 3610, which adds several new requirements to the foreclosure process when a homeowner has requested a home loan modification from their lender. The law amends ORS 86.737 by requiring lenders to provide homeowners with an explanation of how the lender determined that the homeowner was not eligible for a home loan modification. It also requires an affidavit of compliance from the trustee conducting the sale.

Most of the changes to the legal requirements for foreclosures which were first enacted in 2009 were not slated to take effect until January 2, 2012. However this new law moves up the effective date to May 27th, 2010.

These new requirements will cause a lot of an worry and extra work for lenders conducting foreclosures, and there are bound to be some lenders that do not comply with all the new requirements. The legal effect of failure to comply with the new requirements is not specified in the laws. A trustee who fails to follow the procedures would certainly be exposed to a lawsuit for breach of its duties to the
lender, and possibly even to a homeowner who was damaged by the foreclosure.

I plan on exploring litigation strategies relating to the new laws for homeowners who have been damaged in a foreclosure action. The new requirements also will provide an opportunity to prevent a foreclosure sale from going forward by filing a legal action for an emergency injunction through the courts.

For further information please contact me. If you have a friend in danger of losing a home to foreclosure, direct them to watch my video explaining the 8 foreclosure questions in brief. If you live in Beaverton, Hillsboro, or Portland Oregon, give me a call with your questions or comments, or post a comment to this blog.