On December 19, 2018, Ohio Governor Kasich signed Ohio House Bill 489-bringing about changes to regulatory requirements for credit unions, mortgage servicers and mortgage creditors. The new requirements are effective March 20, 2019.
Please see some of most notable changes below.
New demand letter requirements:
The bill created ORC §1349.72 that requires a required notice to be sent on all 2nd mortgages or junior liens on residential real property prior to attempting to collect the debt.
The Notice shall be in 12-point font and must have the following information:
- The name and contact information of the person collecting the debt;
- The amount of the debt;
- A statement that the debtor has a right to an attorney;
- A statement that the debtor may qualify for debt relief under Chapter 7 or 13 of the United States Bankruptcy Code, 11 U.S.C. Chapter 7 or 13, as amended;
- A statement that a debtor that qualifies under Chapter 13 of the United States Bankruptcy Code may be able to protect their residential real property from foreclosure.
Our office recommends all mortgage creditors send the notice as soon as the loan is in default and law firms send the required notices prior to initiating any foreclosure actions as the priority status of the mortgage may not be known due to the possibility of tax liens, sewer liens or other liens.
Registration and physical office requirement for mortgage servicers
Legislators modified ORC §1322.07 which now requires mortgage servicers to register like lenders and brokers. The statute now requires servicers to maintain an office location in the state.
If you have any questions, please contact Gerner & Kearns Co., L.P.A.