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Maryland House Bill 1154 alters the applicability of certain security breach investigation requirements to certain businesses; altering the applicability of certain security breach notification requirements to a certain owner or licensee of computerized data to allow notification to national information security organizations created for information-sharing and analysis of security threats, to alert and avert new or expanded breaches; prohibiting a certain business from charging a certain owner or licensee of computerized data a certain fee; etc.

These provisions are effective on October 1, 2019.

Iowa Senate Bill 475 provides for notarial acts, including by providing for the use of electronic media, providing penalties, and including effective date provisions. 

These provisions are effective on July 1, 2020.

DSNews--Seth Welborn

New Hampshire House Bill 309, a bill intended to give homeowners more warning when facing foreclosure, was ended by voice vote in the New Hampshire, killing the bill, citing objections from banks and credit unions.

Concord Monitor reports that the Bill would have required a sheriff to hand-deliver a notice of sale to a delinquent homeowner, noting that under the present law, that notice must only be mailed to the homeowner. Additionally, the bill would require that the notice itself explicit about the recourse a homeowner has to fight the non-judicial foreclosure procedure if he or she believes it was illegally issued.

“The committee found that there was a large amount of opposition to the bill form various stakeholders and the financial community,” said Senator Harold French.

Opposition to the bill, including banks, credit unions and municipalities, argued that the bill would have slowed the foreclosure process significantly and tie up the court decision. Opponents of the bill also argued that procedures developed by the Consumer Financial Protection Bureau have already created guidelines for banks to follow during foreclosures, though advocates have said they are poorly enforced.

Senator Dan Feltes expressed his disappointment in the final decision.

“Establishing a process and going through it in some cases will expedite the (legal) process, rather than putting the onus on homeowners to go to court to stop a potentially unlawful foreclosure and instead going through a process right away ... is what most the states do,” he said.

Those in support of the bill, including Feltes as well as New Hampshire Legal Assistance, a provider of legal resources for low-income homeowners, state that notices can be lost or ignored when sent in the mail, and HB 309 offers a safer and more direct way of communicating with homeowners facing foreclosure. Advocates note that many homeowners, though they know they may be behind on payments, may not be aware of how behind they are.

The state of New Jersey enacted multiple foreclosure-related bills that include judiciary foreclosure mediation program; creditor contact information; notice of intention to foreclose; and foreclosure sales procedures. Provisions in these bills range from effective immediately to effective on November 1, 2019.

Governor Phil Murphy today signed a bipartisan legislative package into law that will help New Jerseyans struggling with the state’s highest-in-the-nation foreclosure rate. The new laws will assist homeowners facing the prospect of foreclosure and pave the way for community revival by addressing blight. Many of the measures were recommended in a September 2018 report by the Special Committee on Residential Foreclosures, which was created by Chief Justice Stuart Rabner.

“The foreclosure crisis has hurt our economy and jeopardized economic security of too many New Jersey families,” said Governor Murphy. “Our communities cannot succeed while vacant or foreclosed homes sit empty or while families live in limbo. I am proud to sign these bills into law today and get New Jersey closer to ending the foreclosure crisis.”

Among the bills, Governor Murphy signed A664, which codifies the Judiciary’s Foreclosure Mediation Program into law, creating a long-term, permanent program that will not only increase the number of people entering mediation, but also ensure that homeowners receive housing counseling assistance to help provide them with the best possible outcomes in the foreclosure process.

“The foreclosure crisis hit the families of Atlantic County harder than almost any county in the nation. These bills offer a better path for the region and hope for families in despair,” said Special Counsel Jim Johnson. “It’s a vital and important step forward.” 

"Foreclosure can take an emotional and financial toll on homeowners and their families. These bills bolster our efforts to help keep families in their homes and neighborhoods intact," said New Jersey Housing and Mortgage Finance Agency (NJHMFA) Executive Director Charles A. Richman. "We know housing counseling works. Counseled homeowners are nearly three times as likely to have their loans modified, and 70 percent more likely to remain current after modification. That why we have heavily invested our efforts on working to get families the counseling help they need.”

The Governor signed the following nine bills into law:

Effective Immediately

• S3416 - Clarifies that "New Jersey Residential Mortgage Lending Act" applies to certain out-of-state persons and involved in residential mortgage lending in the State. 

• A5001 - Revises statute of limitations for residential mortgage foreclosures.

• A5002 - Permits certain planned real estate developments to file certain liens; concerns limited priority of certain liens.

• S3413 - Makes certain changes to summary action foreclosure process under "Fair Foreclosure Act."

Effective 07/29/2019

• A4997 - "Mortgage Servicers Licensing Act." 

• A4999 - Requires filing of certain creditor contact information with residential mortgage foreclosure complaint and lis pendens.
  
• S3464 - Revises certain procedures for real estate foreclosure sales; alters adjournment of sale process.
  

Effective 08/1/2019

• S3411 - Requires receivership appointment application prior to certain foreclosure actions; requires notice of intention to foreclosure on residential mortgage to be filed within 180 days prior to commencing foreclosure; limits reinstatements of dismissed mortgage foreclosure actions.

Effective 11/1/2019

• A664 - Codifies the Judiciary's Foreclosure Mediation Program ["New Jersey Foreclosure Mediation Act"]; dedicates monies from foreclosure filing fees and fines. 

“Foreclosures are tragic situations for New Jersey families that can also create public safety as well as quality of life issues for surrounding communities,” said Senator Steve Oroho,sponsor of the bill package. “Doing our part to reduce the foreclosure rate statewide will protect families, make neighborhoods safer, and provide children the stability they need both at home and at school. I am proud Governor Murphy signed our bipartisan bill package into law. Stable homes will lead to happier households and better neighborhoods throughout our state.”

“We are all aware that the surge in foreclosed properties is a significant factor that hinders more sustained economic growth in our state,” said Senator Troy Singleton. “Solving the foreclosure issue by preventing homeowners from initially falling into this process will help to increase property values and stabilize our communities, while improving our state’s overall economic outlook. This issue is not new. However, the comprehensive approach outlined in these bipartisan laws is unprecedented in our state. They will build upon the continued reduction in pending foreclosure cases and shorten the timeline to adjudicate these cases. This is a reflection of the work undertaken by every branch of our state government.”

“Sadly, for too long our state has led the nation in foreclosures, with 70,000 properties going through the process in 2017 alone. Recognizing this problem, Chief Justice Rabner impaneled a blue ribbon committee encompassing the public, private and non-profit sectors to craft solutions, both legislative and regulatory, that were both fair and responsible to our state's residents and housing economy. I was privileged to serve and be a part of the solution,” said Assembly Speaker Craig Coughlin. “The nine bills signed into law today are the first of many steps we’ll take to address foreclosure process concerns in the state. More efficiency and ensuring fairness in the current system protects the interests of our homeowners, our neighborhoods and communities.”      

“These new laws will help us take a comprehensive approach in dealing with foreclosed homes in New Jersey,” said Assemblyman Benjie Wimberly. “Foreclosed properties that sit in neighborhoods for years without being maintained are also a major problem, because these homes become eyesores to the community and drive property values down. As chair of the Assembly Housing and Community Development Committee, I will continue to work with Speaker Coughlin and our caucus to help solve the foreclosure crisis in New Jersey.”    

Advocates also expressed support for the measures. 

“We thank Governor Murphy and the Legislature for providing valuable tools to address our state’s relentless foreclosure crisis,” said Staci Berger, President and Chief Executive Officer of the Housing and Community Development Network of NJ. “Residents and neighborhoods have suffered needlessly because the prior Administration failed to take important steps like these. During that time, residents and communities of color were disproportionately impacted by the crisis, losing so much of their housing equity. As NJ’s largest HUD housing counseling intermediary, the Network is thrilled that New Jersey’s leaders are now working with us and our members to keep people in their homes and helping to protect the single largest investment working families can make.”  

“Thanks to the leadership of both Governor Murphy and the legislators who sponsored this bill package, New Jersey is one step close to putting the foreclosure crisis behind us,” said Winn Khuong, Executive Director of Action Together New Jersey. “Governor Murphy’s action today puts New Jersey on a path to renewing our communities, something that will change the lives of so many. We are pleased to see New Jersey’s leaders moving the state in the right direction.”

“We applaud Governor Murphy and all of the legislators on the passage of this package of bills,” said Renee Koubiadis, Executive Director of the Anti-Poverty Network of New Jersey. “Taken together, these bills will allow for a more transparent and fairer process for people facing default and will help alleviate New Jersey's persistent foreclosure crisis. Particularly, the codification and funding of the Foreclosure Mediation Program will allow families receive to counseling and mediation to find a resolution to be able to stay in their homes.”

"A decade after the financial crisis, New Jersey continues to lead the nation in foreclosures," said Kevin Walsh, Executive Director of Fair Share Housing Center. "This legislative package will provide needed relief by increasing protections for homeowners and holding lenders accountable. We'd like to thank Governor Murphy and legislative leaders, including Senator Singleton, for pushing through proposals designed to protect working families."

HousingWire--Kelsey Ramírez

Iowa became the latest state to enable fully digital closings for mortgage transactions Monday with the passage of its new eNotary law.

Monday, Iowa Governor Kim Reynolds signed SF 475, an act providing for notarial acts, including by providing for the use of electronic media, providing penalties, and including effective date provisions.

The first photo above shows Reynolds signing the bill. In her lap she holds LenderClose Chief Operating Officer Benjamin Rempe’s daughter, who he promised could attend the signing if the bill was passed.

Click to Enlarge

“My daughters held me accountable to getting this done because I promised them they could attend the bill signing,” Remp [pictured far right in second photo] said. “What an amazing moment to share with them.”

While e-mortgages are making strides in the housing industry, eClosings are still rare, mostly due to state restrictions surrounding eNotaries. However, that is slowly beginning to change.

As electronic notarization provider Notarize noted recently, Iowa becomes the 10th state to pass a remote online notarization bill this year, bringing the nationwide total of states that allow its notaries to perform notarizations nationwide to 18. 

Now, Iowa has joined the growing list of states that now allow for remote notarization.

“We moved Iowa forward today,” LenderClose Founder and CEO Omar Jordan [pictured far left in second photo] said. “Not just LenderClose.”

DSNews--Seth Welborn

Kuwaiti real estate broker AbdulAziz HouHou is currently in prison for a scam worth $140 million to $240 million, in which HouHou and his company allegedly defrauded thousands of investors.

HouHou sold houses to investors promising 15% returns, with a management company taking care of everything from tenant leasing to repairs and rent collection. However, The Buffalo News reports that many of the houses sold were rundown and dilapidated, and HouHou often sold homes to two different investors at the same time, or sold houses that were not even for sale.

HouHou’s companies flipped around 160 houses in the Buffalo, New York, area, a quarter of which faced housing court judgement, and half of which entered foreclosure. Buffalo News found that half of the 40 houses HouHou sold in Buffalo on a single day in December 2015 were vacant at the time of sale, according to a Buffalo housing inspections report. Sixteen houses were so dilapidated that the city had them demolished, while nine caught fire and many were vacant and stripped of piping.

"Vacancies in neighborhoods create many problems. Neighbors have been concerned, and have been complaining," said Louis J. Petrucci, Assistant Director of Buffalo's Department of Permits and Inspections Service.

All of this led to increased urban blight in areas where HouHou and his company operated, including Buffalo, as well as Detroit, Cleveland, Florida, and North Carolina.

A white paper published by the National Mortgage Servicing Association (NMSA) discussed some “common sense, practical, and affordable remedies,” aimed at reducing the costs of foreclosure practices and community blight. According to the white paper, titled “Understanding the True Costs of Abandoned Properties: How Maintenance Can Make a Difference,” the typical foreclosed home can impose costs of around $170,000, $85,000 of which is attributable to vacant property requirements and condition.

“It’s time to rethink how we deal with vacant and abandoned properties,” the white paper states. You can read the full white paper here.

Washington Senate Bill 5641 adopts the 2018 uniform law commission amendments to the uniform law on notarial acts that include acts performed by remotely located individuals.

These provisions are effective on October 1, 2020.

Georgia House Bill 212 is an Act to amend Article 13 of Chapter 1 of Title 7 of the Official Code of Georgia Annotated, relating to licensing of mortgage lenders and mortgage brokers, so as to 

• exempt retailers, retail brokers of manufactured homes or mobile homes, and residential contractors from the requirement to obtain a license as a mortgage loan originator, mortgage broker, or mortgage lender under certain circumstances; 
• to provide for definitions; 
• to provide for related matters; 
• to repeal conflicting laws; and 
• for other purposes.

These provisions are effective on July 1, 2019.

HousingWire--Ben Lane

Following through on a pledge made more than a year ago, the New York Department of Financial Services is launching its own version of the Consumer Financial Protection Bureau, seeking to fill the consumer protection gaps that are beginning to appear as the Trump administration puts more of its stamp on the CFPB.

Back in January 2018, Mick Mulvaney, then the acting director of the CFPB, told the bureau’s employees that the agency would be much gentler towards the companies it regulates under his watch.

At the time, New York’s top financial regulator said that the state would be prepared to step in to address the CFPB’s “troublesome policy shift away from consumer protection,” and will “continue to lead and take action to fill the increasing number of regulatory voids created by the federal government.”

And now, with now-permanent CFPB Director Kathy Kraninger signaling that the bureau will continue being friendlier to those it oversees, the state of New York is now officially taking matters into its own hands.

The NYDFS announced Monday that it is creating a new division that will focus on consumer protection and financial enforcement. The new division combines the previously separate Enforcement and Financial Frauds and Consumer Protection divisions into one entity.

According to the NYDFS, the new Consumer Protection and Financial Enforcement Division will focus on “protecting and educating consumers and fighting consumer fraud, as well as ensuring that regulated entities comply with New York and federal law in relation to their activities serving the public.”

The division will also work to develop “investigative leads and intelligence” that aid in the NYDFS’ efforts to enforce the state’s banking, insurance, and financial services laws; will focus on cybersecurity events; and will also aid in the development of new supervisory, regulatory, and enforcement policies.

The Consumer Protection and Financial Enforcement Division will be led by Katherine Lemire, who will serve as Executive Deputy Superintendent at the NYDFS.

Lemire comes to the NYDFS from StoneTurn, an international consulting firm providing compliance and investigative services, where she was a partner.

Earlier in her career, Lemire served as an Assistant U.S. Attorney in the Southern District of New York, where Lemire investigated federal crimes, including allegations of public corruption, racketeering, fraud, and other white-collar crimes. 

Lemire also served as a prosecutor in the Manhattan District Attorney’s Office.

“As a highly respected and experienced prosecutor, compliance and regulatory professional, Katie is well-positioned to successfully marshal the extensive resources of the Department’s Enforcement and Financial Frauds and Consumer Protection divisions to deliver real results for New Yorkers,” said NYDFS Acting Superintendent Linda Lacewell.

Lacewell also laid out what the expectations are for the new NYDFS’ new consumer protection division.

“DFS’s new Consumer Protection and Financial Enforcement Division will be a powerhouse, and Katie’s knowledge and skillset will greatly strengthen the Department’s mandate to guard against financial crises and to protect consumers and markets from fraud,” Lacewell said.

Lemire said she’s looking forward to leading the state’s efforts.

“Given the paramount importance of consumer protection and regulatory oversight in the financial marketplace, I look forward to once again re-entering public service and serving the best interests of New Yorkers, while utilizing the expertise and dedication of DFS staff and resources of the Department,” Lemire said.

In her position, Lemire will oversee the NYFDS’ Enforcement Division; Investigations and Intelligence Division; Civil Investigations Unit; the Producers Unit; the Consumer Examinations Unit; the Student Protection Unit; and the Holocaust Claims Processing Office.

Maryland House Bill 107 

• substitutes the Commissioner of Financial Regulation for the Department of Labor, Licensing, and Regulation in certain provisions of law relating to the Foreclosed Property Registry; 
• renumbers certain sections; and
• makes technical changes relating to the renumbered sections.

These provisions are effective on October 1, 2019.

Maryland House Bill 61 alters certain net worth requirements for certain applicants and licensees for certain mortgage lending, loan servicing, and loan origination activities to

• establish certain net worth requirements for certain applicants and licensees acting as mortgage loan servicers for government-sponsored enterprises and other entities
• authorize the use of an irrevocable letter of credit from certain institutions to satisfy certain requirements under certain circumstances; etc.

These provisions are effective on October 1, 2019.

Arkansas House Bill 1943 amends The Personal Information Protection Act to revise the definition of "personal information". 

• Adds a definition for "Biometric data" as part of "personal information"
• Adds new requirements for breach of security systems affecting the personal information of more than one thousand (1,000) individuals, including disclosure requirements to affected individuals, and disclosure to the Attorney General at the same time the security breach is disclosed to an affected individual or within forty-five (45) days after the person or business determines that there is a reasonable likelihood of harm to customers, whichever occurs first
• Adds documentation retention requirements for written determination of a breach of the security of a system and supporting documentation for five (5) years from the date of determination
• Adds requirements to provide the Attorney General, upon request, copies of the written determination of the breach of the security of the system and supporting  documentation to the Attorney General no later than thirty (30) days after the date of receipt of the request. 
• Clarifies that the determination and documentation are not subject to public disclosure

These provisions are effective on August 9, 2019 (or 91 days following adjournment of the current legislative session).