Consumer Advocate Bills Stall in Oregon Legislature

Drew Hagedorn

By Drew Hagedorn, Tonkon Torp, LLP, UTA Oregon Lobbyist

As the 2011 Oregon legislation draws to its anticipated June adjournment virtually all bills related to a trustees’ role in the mortgage foreclosure process are now dead.

Advocates introduced more than 20 bills that would have placed unreasonable burdens on trustees. The proposals included:

• Requiring trustees to file affidavits on strict timelines;
  
  
• Expanding duties and obligations of trustees in a foreclosure sale;
  
  
• Requiring mandatory mediation prior to a trustee sale;
  
  
• Unnecessary data collection and other process that added unnecessary complexity to the foreclosure process; and
  
  
• Egregious penalties for violations.

Throughout this session, the UTA has worked closely with other industry stakeholders to these proposals advanced by myriad consumer advocates. UTA’s coalition includes the Oregon Bankers Association, the Independent Community Banks of Oregon and the Northwest Credit Union Association among others. That’s been a critical component of the UTA’s success in the capitol as legislators grapple with unprecedented budget shortfalls and a near even partisan divide.

At this late stage in the legislative session, only two bills of note remain.

The first, Senate Bill 867, is highly problematic legislation that would require trustees to be a domestic corporation, subject trustees to Unlawful Trade Practice Act violations for unintentional, nonprejudicial and technical violations and require unnecessary reporting to the Oregon Department of Justice, moved of the Senate floor the last week of May.  Senate Democrats moved the bill to escape a prior deadline despite broad industry concerns with the bill. UTA is joined in its opposition by bankers, lenders, credit unions and others.

The bill now heads to the House where it is expected to die in committee over industry objections. It is unlikely the bill will receive a hearing in the House.

The second, Senate Bill 491, would add certain notice requirements to tenants of a domicile in foreclosure. UTA worked with the Oregon Bankers Association to amend the bill to and address industry concerns. After winning Senate approval, the bill is stalling in the Oregon House and must move out of committee by Wednesday, June 1 or die.