Oregon Regulatory Update

Oregon Regulatory Update

The Oregon Department of Justice recently amended its rules governing the Foreclosure Avoidance Mediation Program, which became final on January 7, 2013 as discussed in our August 7, 2012 and February 15, 2013 Compliance Memoranda.  The rules are effective August 4, 2013 to January 31, 2014.

OREGON RULES 137-110

 

 

Mediations are now referred to as “resolution conferences.”  Mediators are now referred to as “facilitators.”

 

 

“Service provider website” means an internet-based system maintained by the service provider at http://www.foreclosuremediationor.org and designed to facilitate the exchange of necessary program-related documents and other information.

 

 

The borrower must pay a fee of $175 (previously $200 and in mediations initiated at the request of an at-risk borrower) to the service provider at the time the borrower confirms his or her participation in the mediation.

 

 

The borrower may apply for a waiver of $125 (previously $150) of the fee.

 

 

A borrower’s application for a fee waiver will be granted if the borrower is able to provide satisfactory evidence to the service provider that the borrower’s annual household income is less than:

  • $22,980 (previously $22,340) for a household of 1;
  • $31,020 (previously $30,260) for a household of 2;
  • $39,060 (previously $38,180) for a household of 3;
  • $47,100 (previously $46,100) for a household of 4;
  • $55,140 (previously $54,020) for a household of 5;
  • $63,180 (previously $61,940) for a household of 6;
  • $71,220 (previously $69,860) for a household of 7;
  • $79,260 (previously $77,780) for a household of 8;
  • $87,300 (previously $85,700) for a household of 9; and
  • $95,340 (previously $93,620) for a household of 10 or more.

 

The service provider must decide whether to grant a fee waiver within 10 days of receiving the application.

 

 

If the service provider denies a borrower’s application for a fee waiver, the borrower must pay the remaining $125 (previously $150) within 15 days of receiving the service provider’s determination not to grant a fee waiver, but not later than the date of the scheduled resolution conference.

 

 

If a lender requests a resolution conference, the lender must pay a $200 processing fee to the service provider at the time of making the request.  The lender must pay an additional $325 to the service provider within 25 days after the service provider makes the borrower’s documents available to the lender.

 

 

If a borrower requests a resolution conference, the lender or the lender’s agent must pay a fee of $525 to the service provider within 25 days after the service provider makes the borrower’s documents available to the lender.

 

 

A junior lienholder that participates in a resolution conference need not pay a fee.

 

 

A lender that is otherwise exempt from the requirement to participate in a resolution conference with a borrower may participate in a resolution conference by paying $325 and by following the resolution conference guidelines.

 

 

The service provider and lender may enter into an agreement allowing the fees to be paid in regular lump sums.

 

 

Lenders claiming an exemption from the requirement to participate in a resolution conference with a borrower must submit an affidavit that substantially complies with “Form 300” at http://www.doj.state.or.us/consumer/foreclosure_mediation.shtml.  The affidavit may be submitted to the Attorney General either:

  • By U.S. mail addressed to Attorney General of Oregon, Foreclosure Avoidance Mediation Program,1162 Court St. NE, Salem, OR 97301-4096; or
  • By email addressed to DOJ@foreclosuremediationOR.org.

 

A lender may request a resolution conference by submitting the request, applicable fees, and required information to the service provider using the service provider website or by fax or mail.  The lender’s request must identify the residential trust deed that the lender intends to foreclose and list the name, title, address, telephone number, and other available contact information for:

  • The lender;
  • Any agent of the lender that will attend the resolution conference;
  • Any person other than a person identified above that will receive, on the lender’s behalf, notices or other communications related to the resolution conference; and
  • The borrower.

 

If the information provided above changes prior to the resolution conference, the lender must update that information with the service provider.

 

 

A borrower may request a resolution conference either:

  • Through a housing counselor who may request a resolution conference on behalf of the borrower by using the service provider website to certify that the borrower is more than 30 days in default on the obligation that the residential trust deed secures or, if the borrower is not in default, that the borrower has a financial hardship that the housing counselor believes may qualify the borrower for a foreclosure avoidance measure; or
  • By submitting a request to the service provider electronically via email or the service provider website, by fax, or by mail.  The request must include a certification by a housing counselor that the borrower is more than 30 days in default on the obligation that the residential trust deed secures or, if the borrower is not in default, that the borrower has a financial hardship that the housing counselor believes may qualify the borrower for a foreclosure avoidance measure.

 

Within 10 days after the date on which the lender or borrower requested a resolution conference, the service provider must send a Notice of Resolution Conference to the borrower and lender.  The notice must:

  • Specify a range of dates within which and a location at which the resolution conference will occur;
  • State that the lender and the borrower each must pay the facilitator’s fees for the resolution conference;
  • List and describe the documents that the lender and borrower must submit to the service provider;
  • State that the borrower must consult a housing counselor before attending the resolution conference unless the borrower notifies the service provider that the borrower could not obtain an appointment with a housing counselor before the date of the resolution conference;
  • State that the borrower may have an attorney or housing counselor present to represent the borrower at the resolution conference, and that the borrower must attend the resolution conference in person unless there are compelling circumstances that prevent attendance in person; and
  • Provide contact information for:
    • The Oregon State Bar’s Lawyer Referral Service;
    • Service agencies or other providers that offer free or low-cost legal services; and
    • A list of not-for-profit housing counselors approved by the Oregon Housing and Community Services Department.

 

Within 5 days after receiving the borrower’s fee, the service provider must send a written notice to the borrower and the lender that specifies the date, time, and location of the resolution conference.

 

 

The borrower must provide the following documents to the service provider for provision to the lender within 25 (previously 15) days after the date on which the service provider sends a Notice of Resolution Conference:

  • A completed “Universal Intake Form” provided in Appendix B (previously Appendix D) and available by selecting “Form 610” at http://www.doj.state.or.us/consumer/foreclosure_mediation.shtml or a substantially similar form;
  • Information about the borrower’s income, expenses, debts, and other obligations;
  • A description of the borrower’s financial hardship, if any; and
  • Documents that verify the borrower’s income.

 

Within 5 days of receiving documents provided by the borrower, the service provider must make those documents available to the lender using the service provider website.  The service provider must provide the documents to the lender in an alternative format upon request.

 

 

Within 25 (previously 15) days after the service provider makes the information the borrower provided available to the lender, the lender must provide the following documents to the service provider for provision to the borrower:

  • Copies of:
    • The residential trust deed; and
    • The promissory note that is evidence of the obligation that the residential trust deed secures and that the lender or lender’s agent certifies is a true copy;
  • The name and address of the person that owns the obligation that is secured by the residential trust deed;
  • A record of the borrower’s payment history for the longer of the preceding 12 months or since the lender last deemed the borrower current on the obligation;
  • An itemized statement that shows:
    • The amount the borrower owes on the obligation, itemized to reflect the principal, interest, fees, charges, and any other amounts included within the obligation; and
    • The amount the borrower must pay to cure the borrower’s default;
  • A document that identifies:
    • The input values for each net present value model that the lender or the lender’s agent uses in this transaction; and
    • The output values that each net present value model produces;
  • The appraisal or price opinion the lender relied on most recently to determine the value of the property that is the subject of the residential trust deed;
  • The portion of any pooling agreement, servicing agreement, or other agreement that the lender cites as a limitation or prohibition on modifying the terms of the obligation, together with a statement that describes the extent to which the lender tried to have the limitation or prohibition waived; and
  • A description of any additional documents the lender requires to evaluate the borrower’s eligibility for a foreclosure avoidance measure.

 

The resolution conference may be rescheduled upon written notice that the lender and borrower have agreed to a new date not more than 30 days after the original date scheduled for the resolution conference (previously upon a showing of good cause or the parties’ written agreement).

 

 

If the request to reschedule is granted, the new date may not be more than 30 days after the original date scheduled for the resolution conference.

 

 

The borrower, or any individual that a court appoints to act on the borrower’s behalf, must attend the resolution conference in person unless there are compelling circumstances that prevent attendance in person.

 

 

The service provider must issue a certificate of compliance if:

·        The borrower fails to timely pay the fee; or

·        The service provider receives a report from the facilitator that states the resolution conference has concluded and the service provider’s records demonstrate that the lender has:

o       Submitted the required materials to the service provider;

o       Appeared in person at, or sent an agent to, the resolution conference with complete authority to negotiate on the lender’s behalf and commit the lender to a foreclosure avoidance measure, or if the lender or agent did not have complete authority, required the participation by remote communication of a person with complete authority to negotiate on the lender’s behalf and commit the lender to a foreclosure avoidance measure;

o       Signed a document that sets forth the terms of any foreclosure avoidance measure to which the lender and the borrower agreed; and

o       Complied with applicable Oregon law.

 

The certificate of compliance that has been signed and notarized by the service provider must be issued to the lender or the lender’s agent no later than 5 days following:

·        The due date by which the borrower was required to pay applicable fees if the certificate is issued because the borrower fails to timely pay the fee; or

·        The conclusion of the resolution conference if the certificate is issued because the service provider receives a report from the facilitator that states the resolution conference has concluded in accordance with the above requirement.

 

 

The certificate of compliance must include a certification that the borrower failed to timely pay the fee, if applicable, in addition to the current requirements.

 

 

The certificate of compliance need not include a certification that the borrower declined to enter into mediation with the lender or did not confirm intent to participate by the required date.

 

 

If a lender fails to meet a requirement, the service provider must issue a notice explaining why the service provider will not issue a certificate of compliance.  This notice must substantially comply with the model form provided in Appendix D to the division 110 rules and available as “Form 670a” at http://www.doj.state.or.us/consumer/foreclosure_mediation.shtml.  This notice must be submitted via hard copy to the lender by U.S. mail, or in person.  A copy of the certificate must be submitted to borrower by fax, by U.S. mail, or in person.  The service provider may make the notice available to the borrower and the lender via the service provider website.

 

 

The following provisions have been deleted from the rules:

 

 

Within 10 days of the mediation scheduling notice, either party may request that the mediation service provider reschedule the date for the mediation session to a date or location that is more convenient.  The rescheduled mediation session must be no earlier than 45 days and not later than 90 days after the date on which the notice of mediation was served or mailed.

 

 

With the parties’ consent, a mediation session may be adjourned and an additional mediation session scheduled.