Comments on: SB 1271: Arizona Real Estate Foreclosure Law Change

By: Dru Bloomfield

Dru Bloomfield — Sun, 13 Sep 2009 14:38:56 +0000

I’m a little slow to get this post updated, but did want to make sure you are all aware that this legislation has been repealed.

By: Christy

Christy — Thu, 03 Sep 2009 02:01:57 +0000

does this law apply to condos as well since they are technically single family residences on less than 2.5 acres?

By: Real Estates Highlights : Arizona Real Estate

Real Estates Highlights : Arizona Real Estate — Sat, 29 Aug 2009 21:09:44 +0000

[...] Arizona Real Estate Foreclosure Law Change [...]

By: Real Estates Highlights — At Home In Scottsdale | Your Guide to Scottsdale Real Estate

Mon, 10 Aug 2009 03:30:34 +0000

[...] Arizona Real Estate Foreclosure Law Change [...]

By: Dru Bloomfield

Dru Bloomfield — Fri, 07 Aug 2009 12:59:32 +0000

Got this update from Tom Farley at AAR yesterday:

SB 1271 has been getting a lot of press lately as it will have serious and unintended consequences for many real estate owners facing foreclosure in Arizona. In light of this the original sponsor of the bill, Senator Steve Pierce, has asked the legislature and the Governor for an immediate repeal of the law which is slated to go into effect at the end of September. The state’s original anti-deficiency language has been inserted into two budget bills (HB 2008 and SB 1024) currently being debated by the legislature which would have the effect on nullifying the passage of SB 1271. HB 2008 has quickly passed the Arizona House of Representatives. SB 1024 is awaiting final vote which could happen August 8th or on the 10th. If for some reason, the Senate Bill fails on final vote, we will immediately focus on our next effort to repeal the law. The banking lobby and at least one member of the legislature are pushing for an amendment to SB 1271, instead of repeal, that would allow it to still apply retroactively to loans already in existence. We have been advised that this action would ultimately be unconstitutional if not unjust. Stay tuned for more updates on our efforts to repeal SB 1271 through the bills cited above.

By: Happy Homeowner (well before this)

Happy Homeowner (well before this) — Wed, 05 Aug 2009 13:50:30 +0000

Unknown –
I am curious how you think this change to the law will help control property values? It was not just investors that pushed up values. By and large it was folks armed with ARMS and no doc loans that required no down payment. Investor loans were tougher to get, even in the boom and required more cash down. About all this will due is assure mutual destruction. Both of the banks and of the homeowners. The banks can’t squeeze blood from a turnip. If the person is in foreclosure, they probably don’t have any money to go after anyway. They will just go BK, and the bank STILL won’t get anything. I also would be very suprised if Judges will look at “utilizing” a dwelling as just living in it. If you are a trustor, unless you just left the home vacant for the whole time (flippers) I don’t see a strong case that could be made that a landlord was not “utilizing” the home as a single family or dual family residence. Even Pierce himself said that it’s intent was against builder / speculators, that would imply a vacant home or home to flip. Since the definition of utilizing is not clearly defined, the big issue I see is with the language that you have to provide a certificate of occupancy. THAT is the 100 pound gorilla that will hurt owner occupants, vacation home owners and investors. Unless you have a custom home built, you probably did not get a C of O from your builder. This will make it necessary for homeowners to go to the building department and have an inspection of their home and get the C of O to cover their rear ends. I am sure the local building code enforcers are going to love that…..or at the very least, it will require the homeowner going to the building department and requesting a copy of the existing C of O issued to the original builder. More enjoyment for the building dept.
Frankly, I think it will be reversed – either that or Steve Pierce is going to be a one term senator, and next to Brewer, one of the most hated politicians in the state. Why do you think he has done such an about face, he knows that if we become number 1 in the nation for bankruptcy from home deficiency judgements, it will fall squarely on his shoulders. And if that contributes to the further decline of our local economy, he may not even make it to election time. Those second home owners in Prescott may have him removed prior to that.

By: Juliana James-Thomas

Juliana James-Thomas — Wed, 05 Aug 2009 04:21:35 +0000

If, and that’s a huge IF…If there is not some sort of temporary stay or moratorium, before the statute’s effective date, a mortgagee lien interest in an investment or rental property and even a second home, based on the six-month occupancy requirement, any deficiency balance appears to be able to be pursued.

By: Unknown

Unknown — Sat, 01 Aug 2009 03:40:00 +0000

I believe that a lot of us who are paying our bills on time and struggling to keep our homes, should definitely be protected. For all of those who wanted to make a quick buck, I don’t feel sorry for them. They are not better then us, they enjoyed their profits when they were good, but when it comes to take their losses , they are all for easy way out. I don’t want to sound mean or anything like that, but to keep our values at least close to what we owe, legislature has to do something about it. There are many things that I disagree with today’s politics, but i think that this was necessary to protect us home owners and financial institutions to some extent.

By: Dru Bloomfield

Dru Bloomfield — Wed, 29 Jul 2009 20:28:59 +0000

Brenda,

Check out this Arizona Attorney General link for some additional help: http://www.azag.gov/consumer/foreclosure/
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By: Dru Bloomfield

Dru Bloomfield — Wed, 29 Jul 2009 20:25:37 +0000

I just got the email update from Michelle Lind, AAR General Counsel / Assistant CEO:

Sen. Steve Pierce, sponsor of SB 1271, feels the bill needs to be fixed due to the unforeseen and unintended consequences of the legislation. He has asked the Legislature and the Governor’s office to repeal the bill so that legislators and industry stakeholder groups can work on a new bill to accomplish the original objective of 1271- to help small community banks in Arizona.

Pierce met with AAR and other stakeholders yesterday to discuss changes to the legislation. The consensus was that there is a more direct way to assist local Arizona banks, who were not eligible to receive any TARP funds, on the ever-growing foreclosure issue.
Dru Bloomfield´s last blog ..Scottsdale Summers are Hot – Be Smart About It