- i - Senate Engrossed State of ArizonaSenateForty-ninth LegislatureSecond Regular Session2010
SENATE BILL 1130
AN ACT AMENDING TITLE 44, CHAPTER 9, ARIZONA REVISED STATUTES, BY ADDING ARTICLE 22;RELATING TO FORECLOSURE CONSULTANTS. (TEXT OF BILL BEGINS ON NEXT PAGE)
S.B. 1130 - 1 -Be it enacted by the Legislature of the State of Arizona:1Section 1. Title 44, chapter 9, Arizona Revised Statutes, is amended2by adding article 22, to read:3ARTICLE 22. FORECLOSURE CONSULTANTS444-1378. Definitions 5
IN THIS ARTICLE, UNLESS THE CONTEXT OTHERWISE REQUIRES:61. "COVERED SERVICE" INCLUDES:7(a) FINANCIAL COUNSELING, INCLUDING DEBT COUNSELING AND BUDGET8
COUNSELING.9(b) RECEIVING MONEY FOR THE PURPOSE OF DISTRIBUTING IT TO CREDITORS IN10
PAYMENT OR PARTIAL PAYMENT OF ANY OBLIGATION SECURED BY A MORTGAGE OR OTHER11LIEN ON A RESIDENCE IN FORECLOSURE.12(c) CONTACTING A CREDITOR ON BEHALF OF A HOMEOWNER.13
(d) ARRANGING OR ATTEMPTING TO ARRANGE AN EXTENSION OF THE PERIOD14
WITHIN WHICH A HOMEOWNER MAY CURE THE HOMEOWNER'S DEFAULT AND REINSTATE THE15HOMEOWNER'S OBLIGATION PURSUANT TO A NOTE, MORTGAGE OR DEED OF TRUST.16(e) ARRANGING OR ATTEMPTING TO ARRANGE ANY DELAY OR POSTPONEMENT OF17
THE TIME OF A FORECLOSURE SALE.18(f) ADVISING THE FILING OF ANY DOCUMENT OR ASSISTING IN ANY MANNER IN19
THE PREPARATION OF ANY DOCUMENT FOR FILING WITH THE UNITED STATES BANKRUPTCY20COURT.21(g) GIVING ANY ADVICE, EXPLANATION OR INSTRUCTION TO A HOMEOWNER THAT22
RELATES TO THE CURE OF A DEFAULT IN OR THE REINSTATEMENT OF AN OBLIGATION23SECURED BY A MORTGAGE OR OTHER LIEN ON THE RESIDENCE IN FORECLOSURE, TO THE24FULL SATISFACTION OF THE OBLIGATION OR TO THE POSTPONEMENT OR AVOIDANCE OF A25FORECLOSURE SALE.262. "FORECLOSURE CONSULTANT" MEANS A PERSON WHO, DIRECTLY OR27INDIRECTLY, MAKES ANY SOLICITATION, REPRESENTATION OR OFFER TO A HOMEOWNER TO28PERFORM FOR COMPENSATION OR WHO, FOR COMPENSATION, PERFORMS ANY COVERED29SERVICE THAT THE PERSON REPRESENTS WILL DO ANY OF THE FOLLOWING:30(a) PREVENT OR POSTPONE A FORECLOSURE SALE.31
(b) OBTAIN ANY FORBEARANCE FROM ANY MORTGAGEE OR BENEFICIARY OF A DEED32
OF TRUST.33(c) ASSIST THE HOMEOWNER TO EXERCISE THE RIGHT OF REINSTATEMENT34
PROVIDED IN THE LEGAL DOCUMENTS.35(d) OBTAIN ANY EXTENSION OF THE PERIOD WITHIN WHICH THE HOMEOWNER MAY36
REINSTATE THE HOMEOWNER'S OBLIGATION.37(e) OBTAIN ANY WAIVER OF AN ACCELERATION CLAUSE CONTAINED IN ANY38
PROMISSORY NOTE OR CONTRACT SECURED BY A MORTGAGE ON A RESIDENCE IN39FORECLOSURE OR INCLUDED IN THE MORTGAGE OR DEED OF TRUST.40(f) ASSIST THE HOMEOWNER IN FORECLOSURE OR LOAN DEFAULT TO OBTAIN A41
LOAN OR ADVANCE OF MONEY.42(g) AVOID OR AMELIORATE THE IMPAIRMENT OF THE HOMEOWNER'S CREDIT43
RESULTING FROM THE RECORDING OF A NOTICE OF SALE OR THE OCCURRENCE OF A44FORECLOSURE SALE.45(h) SAVE THE HOMEOWNER'S RESIDENCE FROM FORECLOSURE.46
S.B. 1130 - 2 -(i) ASSIST THE HOMEOWNER TO ACCOMPLISH A FORECLOSURE RECONVEYANCE.1
3. "FORECLOSURE RECONVEYANCE" MEANS A TRANSACTION THAT INVOLVES BOTH2OF THE FOLLOWING:3(a) THE TRANSFER OF TITLE TO A RESIDENCE IN FORECLOSURE BY A HOMEOWNER4
DURING A FORECLOSURE PROCEEDING BY EITHER:5(i) THE TRANSFER OF AN INTEREST IN THE RESIDENCE IN FORECLOSURE FROM6
THE HOMEOWNER.7(ii) THE CREATION OF A MORTGAGE OR OTHER LIEN DURING THE FORECLOSURE8
PROCESS THAT ALLOWS THE ACQUIRER TO OBTAIN TITLE TO THE RESIDENCE IN9FORECLOSURE BY REDEEMING THE PROPERTY AS A JUNIOR LIENHOLDER.10(b) THE SUBSEQUENT CONVEYANCE OR PROMISE OF A SUBSEQUENT CONVEYANCE OF11
AN INTEREST IN THE RESIDENCE TO THE FORMER HOMEOWNER BY THE ACQUIRER, OR A12PERSON ACTING IN CONCERT WITH THE ACQUIRER, THAT ALLOWS THE FORMER HOMEOWNER13TO REMAIN IN POSSESSION OF THE RESIDENCE FOLLOWING THE COMPLETION OF THE14FORECLOSURE PROCEEDING. FOR THE PURPOSES OF THIS SUBDIVISION, "INTEREST IN15THE RESIDENCE" INCLUDES AN INTEREST IN A CONTRACT FOR A DEED, A PURCHASE16AGREEMENT AND AN OPTION TO PURCHASE OR LEASE.174. "FORECLOSURE SALE" MEANS THE SALE OF REAL PROPERTY TO ENFORCE AN18OBLIGATION SECURED BY A MORTGAGE OR LIEN ON THE PROPERTY, INCLUDING THE19EXERCISE OF A TRUSTEE'S POWER OF SALE.205. "HOLDER OF EVIDENCE OF DEBT" MEANS THE PERSON IN ACTUAL POSSESSION21OF OR OTHERWISE ENTITLED TO ENFORCE AN EVIDENCE OF DEBT BUT DOES NOT INCLUDE22A PERSON ACTING AS A NOMINEE SOLELY FOR THE PURPOSE OF HOLDING THE EVIDENCE23OF DEBT OR DEED OF TRUST AS AN ELECTRONIC REGISTRY WITHOUT ANY AUTHORITY TO24ENFORCE THE EVIDENCE OF DEBT OR DEED OF TRUST.256. "HOMEOWNER" MEANS THE RECORD OWNER OF A RESIDENCE IN FORECLOSURE AT26THE TIME THE NOTICE OF THE PENDENCY OF AN ACTION FOR FORECLOSURE OR THE27RECORDING OF A NOTICE OF SALE PURSUANT TO SECTION 33-808.287. "RESIDENCE IN FORECLOSURE" MEANS RESIDENTIAL REAL PROPERTY29CONSISTING OF NOT MORE THAN FOUR FAMILY DWELLING UNITS, ONE OF WHICH THE30HOMEOWNER OCCUPIES AS A PRINCIPAL PLACE OF RESIDENCE, AND AGAINST WHICH THERE31IS RECORDED AN OUTSTANDING NOTICE OF THE PENDENCY OF AN ACTION FOR32FORECLOSURE OR NOTICE OF SALE PURSUANT TO SECTION 33-808. 3344-1378.01. Applicability 34
A. THIS ARTICLE DOES NOT APPLY TO:351. A PERSON LICENSED TO PRACTICE LAW IN THIS STATE, WHILE PERFORMING36ANY ACTIVITY RELATED TO THE PERSON'S ATTORNEY-CLIENT RELATIONSHIP WITH A37HOMEOWNER OR WITH THE BENEFICIARY, MORTGAGEE, GRANTEE OR HOLDER OF ANY LIEN38BEING ENFORCED BY FORECLOSURE.392. A HOLDER OR SERVICER OF AN EVIDENCE OF DEBT OR THE ATTORNEY FOR THE40HOLDER OR SERVICER OF AN EVIDENCE OF DEBT SECURED BY A DEED OF TRUST OR OTHER41LIEN ON ANY RESIDENCE IN FORECLOSURE WHILE THE PERSON PERFORMS SERVICES IN42CONNECTION WITH THE EVIDENCE OF DEBT, LIEN, DEED OF TRUST OR OTHER LIEN43SECURING THE DEBT. FOR THE PURPOSES OF THIS PARAGRAPH, THE FOLLOWING PERSONS44ARE PRESUMED TO BE THE HOLDER OF EVIDENCE OF DEBT:45
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