Unfortunately, I've had very little time to update this blog today. I was at a food safety forum held by the AG department and have a very busy day working on the show. Look to the right for a link to my food story. Gov. Easley signed some legislation involving mortgages and foreclosures. Here's a release on it for you reading pleasure!
RALEIGH – Gov. Mike Easley announced today he has signed legislation to reign in abusive lending practices, provide consumers with more information and protect unsuspecting homebuyers and tenants from unfair fees and penalties. The three bills signed into law are:
House Bill 1374: “An act to overturn the Shepard case and amend the limitation regarding actions to recover for usury; to overturn the Skinner case and amend the long-arm statute to allow North Carolina courts to exercise personal jurisdiction over certain nonresidential defendants; to require that a notice of foreclosure contain certain information; and to provide for mortgage debt collection and servicing.”
House Bill 1817: “An act to protect consumers regarding covered loans and to increase the Banking Commissioner’s disciplinary authority over licensees under the Mortgage Lending Act.”
House Bill 947: “An act to require that notice of sale in foreclosure proceedings be sent to certain tenants residing in the property to be sold, to allow those tenants after receiving the notice to terminate the rental agreement upon ten days written notice to the landlord, to require that those tenants be given thirty days notice of an application for an order of possession, and to clarify that the proceeds in the automation enhancement and preservation fund may be used for the preservation and storage of public records.”
“Purchasing a home is the most significant, and often most confusing, financial obligation most North Carolinians will ever make,” said Easley. “Our state has been the national leader in protecting home ownership. Our 1999 predatory lending law was the nation’s first, and is still the national standard. But the volatile sub-prime lending market has presented new challenges. These new laws will give North Carolinians additional protections from unfair and deceptive lending practices.”
The new laws:
Limit the ability of mortgage brokers to charge customers above market rates and prepayment penalties,
Protect borrowers from abusive adjustable rate mortgages,
Ensure that lenders take into account the ability of borrowers to repay the loans, and
Protect homeowners from abusive mortgage servicing companies that misapply mortgage payments, charge illegal fees and mishandle escrow accounts.
If a homeowner is unable to meet the mortgage payments, loan servicers are now required to give a detailed accounting of the sums claimed to be owed, and to protect the borrower’s interest during the foreclosure proceedings.
The legislation also moves to clarify two recent state Supreme Court decisions that made it harder for borrowers to sue for illegal lending practices. The new law now makes it easier for borrowers to sue than would have been the case if the bill had not addressed the court rulings. “If unscrupulous lenders break the law, this will ensure that they pay the price,” Easley said.
Sponsors of H 1374 were Reps. Dan Blue (D-Wake) Jennifer Weiss (D-Wake), Margaret Dickson (D-Cumberland) and Rick Glazier (D-Cumberland). The bill was carried in the Senate by Sen. Martin Nesbitt (D-Buncombe). It passed the House 118-0 and the Senate 43-0. Most of the bill is effective immediately, while other portions go into effect April 1, 2008.
H 1817 was sponsored by Rep. Dan Blue (D-Wake). It was carried in the Senate by Sen. Martin Nesbitt (D-Buncombe). It passed the House 110-0 and the Senate 33-15. The new law is effective Jan. 1, 2008.
H 947 was sponsored by Reps. Rick Glazier (D-Cumberland) and Dan Blue (D-Wake). It was carried in the Senate by Sen. Fletcher Hartsell, (R-Cabarrus). It passed the House 112-0 and the Senate 34-6. It goes into effect Oct. 1, 2007.