By: Favian ClaiAs reported by Housing Wire, State Representative, Dennis Murray (D-Sandusky), introduced
HB 323 to the
Ohio House of Representatives this week. The Bill would require banks to move foreclosures to auction within a certain timeline or forfeit its
mortgage liens in addition to any proceeds from the sale of the property.
The bill would require that written documents accompany foreclosure filings by banks. The document would have to include:
- The name of the note holder
- Whether it has been securitized
- Identity of the Mortgage Backed Security (MBS) that holds the loan and the name of the trustee
- Statement detailing if residential property is occupied or vacant.
If the borrower answers the foreclosure compliant, the bank must then file a series of reports with the court within 45 days. The report must include:
- The most recent value of the property
- An estimate from the bank on the property's current condition or an appraisal conducted by a licensed appraiser
However, if within 60 days, the borrower does not answer the complaint, then the bill requires that the bank file a motion for default judgment within the next 60 days. That filing must include an affidavit showing that the bank inspected the property, attempted to contact the borrower by telephone and sent letters to the borrower, along with attesting that the property is not occupied.
Finally, if no motion is filed by the bank within the required time frame, the foreclosure complaint will be dismissed and the bank will forfeit the rights to the property along with any proceeds from the sale.
Expect similar measures in other states depending on the success of this one if it passes.
