BILL NUMBER: S7977

SPONSOR: MARCHIONE
 
TITLE OF BILL:

An act to amend the real property actions and proceedings law, in
relation to required notices in a residential mortgage foreclosure
action

 
PURPOSE:

To require banks in mortgage foreclosure actions to notify the munici-
pality where the real property is located when the bank files a lis
pendens for the foreclosure.

 
SUMMARY OF PROVISIONS:

Section 1: Section 1303 subdivision 8 of the real property actions and
proceedings law is amended to require the foreclosure party in a fore-
closure action who is a bank to notify the municipality where the real
property is located when the bank files a lis pendens for the foreclo-
              

sure.

Section 2: Establishes the effective date.

 
JUSTIFICATION:

In the aftermath of the "Great Recession" a financial crisis emerged
causing many people to fall behind on their mortgages and in many
instances leave or abandon their homes. Currently, municipalities find
out about a home in the foreclosure process anywhere from four to eight
weeks after a notice of pendency is filed and the assessor receives
notice from the county. This bill seeks to have the municipality noti-
fied within five days. Earlier notice would enable the municipality to
proactively engage homeowners to stay in their homes and prevent the
property from becoming blighted and the surrounding neighborhoods and
homes from losing significant equity and housing value. In addition,
earlier notice of a foreclosure would benefit the assessor in the timely
creation of the tax roll, especially in the couple of months preceding
the March 1st deadline.

 
LEGISLATIVE HISTORY:

2016: A.9394
2017: A.4895-A

 
FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
Immediately.