Foreclosure procedures; assignment of deed of trust. (HB1506)

Introduced By

Del. Bob Marshall (R-Manassas)

Progress

Introduced
Passed Committee
Passed House
Passed Senate
Signed by Governor
Became Law

Description

Foreclosure procedures; assignment of deed of trust.  Provides that the trustee under any deed of trust or mortgage shall not proceed with any sale of the property unless the land records of the locality in which the property is located contain a duly recorded assignment to the person who asserts that he is the holder of the obligation. The trustee may proceed with the sale (i) upon the recordation of any assignments not recorded or, if an intervening assignment cannot be located, upon the receipt of an affidavit from the party secured that he is the party secured by the deed of trust, and (ii) upon the payment by the person who asserts that he is the holder of the obligation of any fees and taxes for recording the assignment. The bill also provides that a nominee of a grantee or mortgagee for a deed of trust or mortgage has no authority to request that the trustee proceed with any sale of the property conveyed to him by the deed of trust or mortgage. The bill also requires that the party secured by the deed of trust or mortgage provide notice of his intent to foreclose to the property owner at least 30 days before any proposed sale. The bill provides further that a person who (i) knowingly makes, used, or causes to be made or used any false or fraudulent record, document, or statement or (ii) knowingly swears or affirms falsely to any matter, in support of any foreclosure is liable for a civil penalty of $5,000, which shall be paid into the local treasury. The bill also creates a civil cause of action for such a violation in favor of the owner of the property foreclosed upon. Read the Bill »

Outcome

Bill Has Failed

History

DateAction
12/17/2010Committee
12/17/2010Prefiled and ordered printed; offered 01/12/11 11100743D
12/17/2010Referred to Committee for Courts of Justice
01/10/2011Assigned Courts sub: #2 Civil
01/11/2011Impact statement from (HB1506)
01/11/2011Impact statement fromVCSC (HB1506)
01/21/2011Assigned Courts sub: #2 Civil
01/24/2011Subcommittee recommends passing by with letter
02/08/2011Left in Courts of Justice

Comments

Jay S., tracking this bill in Photosynthesis, notes:

marshall

Robert Weed writes:

This is really needed. The current 14 day notice provision might have made sense when it was passed. Back when the same mortgage company handled your mortgage all the way through, the homeowner could keep track of the status of their loan.

But now loans or servicing is transfered here and there, and people are in loan modification trial payments, and then without explanation get 14 day foreclosure notice.

Thirty days give people much more reasonable time to assert their rights if there is a dispute; and to move out if they've given up.

cindi writes:

Virginia has the best system for foreclosures,do not pass this. It is a shame that people loose their homes, but they have had more than 14 days notice. Months of letters for lack of payment. Do not vote for this. The dispute is about paying your mortgage on time,the deed of trust in Virginia is clear as to what occurs should you not pay, this bill is not needed, it is harmful.

Ali Faruk writes:

Cindi,

Homeowners do not decide to vacate the property the first time they miss a mortgage payment, nor should they. Selling the home is an unfortunate final step if homeowners fail to get a permanent loan modification from their mortgage lender. The vast majority of the time spent by homeowners after they default on their mortgage is spent negotiating a loan modification with their lender.

It is only after this process has failed should homeowners then move on to the process of trying to sell their homes (probably through a short sale). 14 days is not enough time to affect a short sale. Any Realtor will tell you that Virginia's fast foreclosure process has hurt the ability of our economy to rebound because numerous short sale deals have fallen through because the foreclosure process is so fast.

Virginia Housing Coalition, tracking this bill in Photosynthesis, notes:

The Virginia Housing Coalition is lending its support to this bill.

K Daley writes:

Virginia has the best system for foreclosures if you are a bank. Cindi must be affiliated with a bank. The bankers in this state have had the GA in their pocket for decades. It's time the GA started looking out for the rights of borrowers against powerful and overbearing banks. I understand people need to pay their debts, but there need to be some safeguards because the banks have gone over the line with their tactics to take peoples' homes.

Robert Weed writes:

Del Marshall's unsuccessful effort is in contrast to this news clipping about Arizona. http://www.businessweek.com/news/2011-02-23/arizona-bill-would-void-foreclosures-without-full-title-history.html.

In that conservative and Republican state, the legislature is able to support new laws to require foreclosing mortgage companies to prove they actually own the loan.

Laws opposed by the financial interests, sadly, don't get the same fair consideration in Virginia that they get in other states.