House Committee on Business, Labor, Economic, & Workforce Development (03/18/2014)

Final
STAFF SUMMARY OF MEETING

HOUSE COMMITTEE ON BUSINESS, LABOR, ECONOMIC, & WORKFORCE DEVELOPMENT

Date:	03/18/2014	ATTENDANCE

Time:	01:34 PM to 03:26 PM	Exum	X
		Hamner	X
Place:	SupCt	Holbert	X
		Navarro	X
This Meeting was called to order by		Nordberg	X
	Representative Williams	Rosenthal	X
		Ryden	X
This Report was prepared by		Szabo	X
	Erin Vanderberg	Wright	X
		Kraft-Tharp	X
		Williams	X
		X = Present, E = Excused, A = Absent, * = Present after roll call

Bills Addressed:		Action Taken:
HB14-1295 HB14-1312		Amended, Referred to the Committee of the Whole Referred to the Committee of the Whole

01:35 PM -- HB 14-1295

Representative Williams called the meeting to order. A quorum was present. Representative McCann presented House Bill 14-1295, concerning residential mortgage foreclosures, and, in connection therewith, requiring a single point of contact and prohibiting dual tracking.

This bill amends statutes governing the foreclosure of residential real estate. The bill generally applies to servicers of residential loans, including lenders and other parties that offer a borrower a loss mitigation option or seek to enforce the power to foreclose and sell the residential real estate that secures a delinquent loan. Such servicers must:

• establish a single point of contact with the borrower, which contact must inform the borrower about loss mitigation options, the status of the borrower's loan, circumstances that may result in foreclosure, and procedures if the borrower believes there is an error in the servicer's records; and

• pursue foreclosure only if the borrower has not qualified for, accepted, or complied with the terms of a loss mitigation option; if the borrower believes the servicer is engaging in prohibited "dual tracking," the public trustee must follow certain procedures, including, if dual tracking is undisputed, suspension of the foreclosure sale and withdrawal of the notice of election and demand.

The bill also requires additional language in certain notices required in the residential foreclosure process. Specifically:

• The lender's foreclosure notice to the borrower must disclose that it is illegal for a foreclosure consultant to require a deposit or charge fees in advance or providing services; and

• Both the public trustee's combined notice and the lender or servicer's posted notice must include a statement regarding the borrower's ability to file a complaint with state and federal authorities if the borrower believes the lender or servicer has violated certain provisions of the bill.

Servicers of fewer than 5,000 loans are exempt from provisions of the bill other than changes to required foreclosure notices.

01:42 PM

The committee took a brief recess.

01:47 PM

The committee came back to order. Representative McCann continued her presentation of the bill and distributed two amendments, Amendment L.001 and Amendment L.002 (Attachments A and B, respectively). Representative McCann discussed the amendments.

140318 AttachA.pdf

140318 AttachB.pdf

01:58 PM

Representative McCann concluded her discussion on the amendments and responded to questions from the committee.

The following individuals testified on the bill:

02:03 PM -- Sharon McKee, representing herself, testified in support of the bill. Ms. McKee discussed her personal experience with a loan modification and a foreclosure.

02:07 PM -- Leonard McWilliams, representing himself, testified in support of the bill. Mr. McWilliams said that if this bill had been a law in 2006, it would have spared him and his family a lot of pain and trauma. He discussed the benefits of a single point of contact in the loan modification process.

02:12 PM -- Corrine Fowler, representing herself, testified in support of the bill. She distributed a survey related to loan modification to committee members (Attachment C). She discussed the current economy and the history of the state's foreclosure crisis.

140318 AttachC.pdf

02:16 PM -- Keith Gantenbein, representing himself, testified in support of the bill. He discussed his experience defending homeowners during the loan modification and foreclosure processes through his law firm Goldman Gantenbein, LLC. Mr. Gantenbein responded to questions from the committee.

02:28 PM -- Tom Warren, representing himself, testified in support of the bill. Mr. Warren discussed his recent experience with foreclosure.

02:31 PM -- Brad Wood, representing Colorado Impact Center for Economic Prosperity, testified in support of the bill. Mr. Wood discussed the advantages of the bill. He stated that the bill strikes a good balance between protecting homeowners and lenders.

02:34 PM -- Artie Lehl, representing the Colorado Housing Counseling Coalition, testified in support of the bill. Mr. Lehl discussed the importance of codifying these rules in statute.

02:37 PM -- Donnah Moody, representing the Public Trustees' Association of Colorado, testified in support of the bill. Ms. Moody discussed the role of the public trustee in the foreclosure process. She discussed her organization's participation in the bill's stakeholder process.

02:40 PM -- Terry Jones, representing the Colorado Mortgage Lenders Association, testified neutrally on the bill. Mr. Jones discussed the changes that have taken place to protect mortgage consumers and discussed his organization's concerns with the bill. Mr. Jones responded to questions from the committee.

02:50 PM

Mr. Jones continued to respond to questions from the committee.

02:54 PM -- Jenifer Waller, representing the Colorado Bankers Association, testified neutrally on the bill. Ms. Waller discussed a bank's role in a foreclosure and discussed her association's concerns with the bill.

02:56 PM -- Catherine Hantz, representing the Colorado Bar Association, testified in support of the bill as amended. She discussed her association's participation in the bill's stakeholder process.


BILL:	HB14-1295
TIME:	02:58:40 PM
MOVED:	Kraft-Tharp
MOTION:	Adopt amendment L.002. The motion passed without objection.
SECONDED:	Ryden
		VOTE
	Exum
	Hamner
	Holbert
	Navarro
	Nordberg
	Rosenthal
	Ryden
	Szabo
	Wright
	Kraft-Tharp
	Williams

YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: Pass Without Objection


BILL:	HB14-1295
TIME:	02:58:53 PM
MOVED:	Kraft-Tharp
MOTION:	Adopt amendment L.001. The motion passed without objection.
SECONDED:	Ryden
		VOTE
	Exum
	Hamner
	Holbert
	Navarro
	Nordberg
	Rosenthal
	Ryden
	Szabo
	Wright
	Kraft-Tharp
	Williams
YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: Pass Without Objection

02:59 PM

Representative McCann made closing remarks on the bill.


BILL:	HB14-1295
TIME:	02:59:35 PM
MOVED:	Kraft-Tharp
MOTION:	Refer House Bill 14-1295, as amended, to the Committee of the Whole. The motion passed on a vote of 6-5.
SECONDED:	Ryden
		VOTE
	Exum	Yes
	Hamner	Yes
	Holbert	No
	Navarro	No
	Nordberg	No
	Rosenthal	Yes
	Ryden	Yes
	Szabo	No
	Wright	No
	Kraft-Tharp	Yes
	Williams	Yes
Final YES: 6 NO: 5 EXC: 0 ABS: 0 FINAL ACTION: PASS

03:03 PM

The committee recessed.

03:04 PM -- HB 14-1312

The committee came back to order. Representative Williams presented House Bill 14-1312, concerning efforts to reduce the number of foreclosures in Colorado, and, in connection therewith, continuing the foreclosure deferment program. Under current law, the foreclosure deferment program in the Department of Local Affairs (DOLA) is scheduled to expire on June 30, 2014. When a borrower is deemed eligible, foreclosure deferment requires the public trustee of a county to delay the scheduled sale of a foreclosed property for up to 90 days. This bill extends the program until September 1, 2015.

The following individuals testified on the bill:

03:12 PM -- Jenifer Waller, representing the Colorado Bankers Association, testified in support of the bill.

03:13 PM -- Peg Ackerman, representing Colorado Public Trustees' Association, testified in support of the bill.

03:15 PM -- Mike Rosser, representing the Colorado Mortgage Lenders Association, testified in support of the bill.

03:17 PM -- Shannon Peer, representing the Colorado Foreclosure Hotline, testified in support of the bill. Mr. Peer discussed the work of the hotline in helping Colorado homeowners in distress. Mr. Peer responded to questions from the committee.

03:21 PM

Representative Williams made closing remarks on the bill.


BILL:	HB14-1312
TIME:	03:21:42 PM
MOVED:	Williams
MOTION:	Refer House Bill 14-1312 to the Committee of the Whole. The motion passed on a vote of 7-4.
SECONDED:	Ryden
		VOTE
	Exum	Yes
	Hamner	Yes
	Holbert	No
	Navarro	No
	Nordberg	No
	Rosenthal	Yes
	Ryden	Yes
	Szabo	No
	Wright	Yes
	Kraft-Tharp	Yes
	Williams	Yes

Final YES: 7 NO: 4 EXC: 0 ABS: 0 FINAL ACTION: PASS

03:26 PM

The committee adjourned.