Key Foreclosure Issues To Be Addressed In Oregon

Oregon Supreme Court
and Legislature to address issues

Oregon Live, an online newspaper, ‘powered’ by The Oregonian reported on December 22nd that “Oregon's new foreclosure mediation program has brought out-of-court foreclosures to a screeching halt.” 

“Faced with new requirements and costs, lenders simply stopped filing new foreclosures. The logjam was compounded a week later by an appellate court ruling that lenders' recording practices didn't meet state law. Five months later, more foreclosures are making their way to courtrooms, an alternative usually slower and costlier for all involved than a traditional foreclosure outside the court system,” the newspaper reports. “It's clear, in short, that the foreclosure machine is broken, which threatens to prolong the foreclosure crisis and hurt a burgeoning real estate market recovery.

Several issues will be dealt with this upcoming year as summarized by The Oregonian:

• In January, the Oregon Supreme Court will have to make a final decision on issues related to MERS.  As background, in July, the Oregon Court of Appeals ruled MERS doesn't qualify as a beneficiary of record for a mortgage, as it is listed on thousands of Oregon deeds (Niday v. GMAC Mortgage, et al). It further ruled that lenders are required to file a complete ownership history of a mortgage before foreclosing.  Because the Court of Appeals sets precedent for lower courts, its findings are now state law.
  
• The banking industry plans to ask the Legislature to validate the system.  Any new law that results would likely pre-empt the court's ruling.
• Lenders are also preparing to ask the Legislature to make changes to the state foreclosure mediation program created in the last legislative session, specifically with respect to easing notification requirements and clarifying the definition of an ‘at risk’ homeowner.

Read full story from Oregon Live (The Oregonian)