New Statute Relating to Residential Foreclosures

Thanks to Indiana Commercial Foreclosure Law and its 2009 Indiana State Legislation - One Foreclosure Bill for bringing this to my attention:

The June edition of Hoosier Banker, published by the Indiana Bankers Association, has a really good article entitled "Wrap-up of 2009 Legislative Session" written by Amber Van Til, VP-Governmental Relations, and Dax Denton, AVP-Governmental Relations. In the article, they address the Indiana General Assembly's 2009 banking-related bills, and Indiana's passage of three bills dealing with depositories. Despite all the recent negative publicity involving lenders and several legislators' efforts to pass multiple mortgage and foreclosure-related bills in 2009 (click for example), only one bill passed that directly affects mortgage foreclosures, Senate Bill 492:  click here for a digest of the bill and click here for a .pdf of the enacted statutory changes.  

SB 492 will be effective June 30, 2009.  The legislation is not unlike the mediation-related procedural rules recently adopted by the Marion County (Indianapolis) court system, about which I wrote on March 15, 2009.  SB 492 creates the opportunity for non-binding settlement conferences between lenders and borrowers, and various notices must be sent and filed before the lender can proceed with the foreclosure suit.  Significant to the primary readers of this site, lenders/plaintiffs are not required to send the notices mandated by the bill if "the loan is secured by a dwelling that is not the debtor's primary residence...."  In other words, like the Marion County scheme, commercial foreclosures are excluded from the new statute. 

FTC Amends Rules on Practice

FTC Issues Final Rules Amending Parts 3 and 4 of the Agency’s Rules of Practice:

"Through the Federal Register notice announced today, the Commission has made changes to several areas of the rules. First, the amendments eliminate Rule 3.11A (Fast Track Proceedings). The Fast Track Proceedings are unnecessary because of the expedited deadlines in the new Part 3 rules.

Second, changes in Rule 3.25 clarify the procedures for the Commission to consider possible settlements while a matter is in administrative litigation.

Third, Rule 3.31(g) has been amended to be consistent with a new federal rule of evidence regarding how parties must deal with documents subject to privilege that another party claims were inadvertently produced.

Finally, amended Rule 4.2 requires a party to file a redacted public version of a petition for certain types of Commission action (such as a petition to quash a subpoena) in non-Part 3 matters if it requests confidential treatment for the petition. The rule also makes other changes that will facilitate the development of a new Commission electronic filing system for adjudicative proceedings."

Indiana Consumer Law: Possible Real Estate Scam

Thestarpress - State warns of new mortgage fraud scheme

FORT WAYNE, Ind. (AP) — Indiana's attorney general is warning about a mortgage fraud scheme in which criminals exploit a loophole in state law to transfer the ownership of properties.

Attorney General Greg Zoeller said the thieves aren't interested in the property they steal, but in using their "ownership" of a property to obtain a fraudulent loan. Once they get the money, they disappear with it and leave the true property owner with the debt.

"The actual homeowners, through no fault of their own, are at risk of losing their home to foreclosure," Zoeller said. "Correcting the problem and clearing the cloud off the title could cost the homeowners thousands of dollars."

Zoeller joined the Indiana Recorders Association and the Association of Indiana Counties in Indianapolis on Thursday to publicize the scheme. He explained that Indiana law does not allow county recorders to demand proof of identification from customers who are recording deeds and other notarized documents.

Other than new legislation, the article offers no suggestions for protection. Not that I can think of any that would be effective - the problem lies in the Recorder's Office.

While legislation would require all the county Recorders to see identification before recording anything, I cannot see any reason why a Recorder's office could not independently require identification.