2015 -- S 0865

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LC001298

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2015

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A N   A C T

RELATING TO PROPERTY -- MORTGAGE FORECLOSURE AND SALE

     Introduced By: Senator Gayle L. Goldin

     Date Introduced: April 28, 2015

     Referred To: Senate Judiciary

     It is enacted by the General Assembly as follows:

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

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

     34-27-8. Requirement of affidavit from certain tax exempt entities. – (a) Definitions.

-- The following definitions apply in the interpretation of the provisions of this section unless the

context requires another meaning:

     (1) "Mortgage loan" means a loan to a natural person made primarily for personal, family

or household purposes secured wholly or partially by a mortgage on residential property.

     (2) "Residential property" means real property on which there is a dwelling house with

accommodations for no more than four (4) dwelling units and occupied, or to be occupied, in

whole or in part, by the obligor on the mortgage debt; provided, however, that residential property

shall be limited to the principal residence of a person; provided, further, that residential property

shall not include an investment property or residence other than a primary residence; and

provided, further, that residential property shall not include residential property taken in whole or

in part as collateral for a commercial loan.

     (b) In all circumstances in which an offer to purchase either a mortgage loan or

residential property is made by an entity with a tax-exempt filing status under section 501(c)(3) of

the Internal Revenue Code, or an entity controlled by an entity with such tax exempt filing status,

no mortgagee shall require as a condition of sale or transfer to any such entity any affidavit,

statement, agreement or addendum limiting ownership or occupancy of the residential property in

question and, if obtained, such affidavit, statement, agreement or addendum shall not provide a

basis to avoid a sale or transfer nor shall it be enforceable against such acquiring entity or any real

estate broker, mortgagor or settlement agent named in such affidavit, statement or addendum.

     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 FORECLOSURE AND SALE

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     This act would provide that no mortgagee shall require an entity with tax-exempt status

under 501 (c)(3) of the Internal Revenue Code to file an affidavit, statement, agreement or

addendum limiting ownership or occupancy of residential property when offering to purchase a

mortgage loan on residential property.

     This act would take effect upon passage.

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