BILL SUMMARY for HB09-1276
HOUSE COMMITTEE ON BUSINESS AFFAIRS AND LABOR
|Votes: View--> ||Action Taken: |
|Moved amendment L.002 (Attachment A), as amended b|
Moved amendment L.003 (Attachment B) to amendment
Moved to refer House Bill 09-1276, as amended, to
|Pass Without Objection|
Pass Without Objection
10:15 AM -- House Bill 09-1276
Representative Ferrandino, prime sponsor, presented House Bill 09-1276 concerning a delay in the foreclosure of residential property for eligible borrowers that was previously heard on February 18, 2009. The bill allows an eligible borrower to defer a foreclosure sale on a residential property for 90 days. The borrower must contact a foreclosure counselor within 20 days after the notice of election and demand is received by the public trustee of the county in which the property is located. A notice of election and demand is the document that starts the foreclosure process once recorded. A foreclosure counselor is defined as a housing counselor employed by an agency approved by the United States Department of Housing and Urban Development, including housing counselors affiliated with the Colorado Foreclosure Hotline and the Hope for Homeowners Hotline. Foreclosure counselors would have immunity and would not be liable to any person for approving or failing to approve a borrower for a foreclosure deferment or for certifying or declining to certify an early termination.
If a loan holder receives notice that a borrower is eligible for a loan deferment, the loan holder must defer the foreclosure for 90 days. The bill identifies criteria that a foreclosure counselor must consider when determining whether a borrower is eligible for a loan deferment. The borrower must make payments during the 90-day deferment period equal to two-thirds of the monthly payment due prior to delinquency, plus one-twelfth of the annual amount due for taxes and insurance.
The Division of Housing in the Department of Local Affairs would provide a description of the foreclosure deferment program to foreclosure counselors. The division would also develop a standard form in English and Spanish that can be posted on the front door of a property that is the subject of a notice of election and demand that provides information regarding how to pursue a mortgage foreclosure deferment. The bill is repealed, effective June 30, 2011.
Representative Ferrandino distributed amendment L.002 (Attachment A), L.003 (Attachment B), and a fact sheet on amendment L.002 (Attachment C).
Carol Snyder, Adams County Public Trustee, representing the Colorado Public Trustees Association, talked about the amendments to the bill and the concerns they address. Representative Gagliardi asked how often the trustee receives incomplete packets. Ms. Snyder explained that the packets come from the lender's attorney, are reviewed by the public trustee for accuracy, and that they can be inaccurate fairly frequently. Representative Liston asked about the increase in work load for the trustees and why it did not generate a fiscal impact. Ms. Snyder explained that the public trustees already review these documents. Representative Priola asked about the federal plan for foreclosures.
Representative Ferrandino gave some closing remarks on the bill. He responded to the concerns over the fiscal note and said that a lot of the requirements in the bill are already being done. Representative Balmer asked about the Spanish requirement provided in the bill and whether that is a new requirement. Representative Ferrandino said it is a new requirement that came from the lenders and lenders' attorneys who work in areas that are predominately Spanish speaking. Representative Liston asked whether people who do not qualify for the program could potentially use the bill to draw out their foreclosure process. Representative Ferrandino said he worked with the lenders to make sure that would not happen and explained that the HUD counselor determines if the borrower is eligible or not. If the borrower is not eligible, then they cannot use any provisions in the bill.
|TIME: || 10:40:36 AM|
|MOTION:||Moved to refer House Bill 09-1276, as amended, to the Committee of the Whole. The motion passed 7-4.|
Final YES: 7 NO: 4 EXC: 0 ABS: 0 FINAL ACTION: PASS