2014 -- S 2637

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LC004467

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2014

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A N   A C T

RELATING TO PROPERTY - MORTGAGE AND FORECLOSURE SALE

     

     Introduced By: Senator Harold M.Metts

     Date Introduced: March 04, 2014

     Referred To: Senate Judiciary

     (Attorney General)

It is enacted by the General Assembly as follows:

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     SECTION 1. Chapter 34-27 of the General Laws entitled "Mortgage Foreclosure and

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Sale" is hereby amended by adding thereto the following section:

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     34-27-7. Maintenance of vacant residential property. – (a) A mortgagee that serves a

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notice of intention to foreclose on a mortgage on residential property in this state pursuant to this

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chapter, shall serve the municipal clerk of the city or town in which the property is located with a

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copy of the notice at the same time that the mortgagee serves the notice on the mortgagor of the

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property. The mortgagee shall designate and continuously maintain an agent, who is a resident of

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this state, upon whom service may be made of any process, notice, or demand required or

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permitted by law to be served, including, but not limited to, notice of minimum housing code

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violations. The notice shall include the full name and contact information of the agent who is

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authorized to accept service on behalf of the mortgagee with the copy of the notice served on the

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municipal clerk.

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     (b) If the residential property becomes vacant at any time after the mortgagee files the

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notice of intention to foreclose, but prior to vesting of title in any third party, and the municipality

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determines that the property is in violation of any applicable state or local housing code, the

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municipality may notify the mortgagee of the violation, by providing a copy of the notice to the

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agent located within the state who is authorized to accept service on behalf of the mortgagee, and

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may require the mortgagee to correct the violation.

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     (c) A municipality that requires a mortgagee to correct a violation pursuant to this section

 

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shall include a description of the conditions that gave rise to the violation with the notice of

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violation and shall provide a period of not less than thirty (30) days from the mortgagee's receipt

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of the notice for the mortgagee to remedy the violation. If the mortgagee fails to remedy the

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violation within that time period, the municipality may impose penalties allowed for the violation

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of municipal ordinances.

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     (d) A mortgagee in violation of subsection (a) of this section shall be subject to a fine of

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up to one thousand dollars ($1,000) per day in violation payable to the municipality.

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     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO PROPERTY - MORTGAGE AND FORECLOSURE SALE

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     This act would require mortgagees, upon filing notice of intent to foreclose against a

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mortgagor, to file a copy of that notice with the city or town municipal clerk, and appoint an

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agent for service of process within the state. Further, the act would require a mortgagee who

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initiates a foreclosure proceeding against a residential property located in the municipality, to

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maintain the property in accordance with state and local housing codes if the property becomes

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vacant during the foreclosure proceeding.

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     This act would take effect upon passage.

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