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State of Arizona, House of Representatives, HB 2642, Foreclosures and Mandatory Mediation

State of Arizona, House of Representatives, HB 2642, Foreclosures and Mandatory Mediation

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Published by: ForeclosureGate.org Library on Mar 08, 2011
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03/08/2011

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 - i -REFERENCE TITLE:foreclosures; mandatory mediation State of ArizonaHouse of RepresentativesFiftieth LegislatureFirst Regular Session2011
HB 2642
Introduced byRepresentatives Tovar, Chabin, Miranda R, WheelerAN ACTAMENDING SECTION 33-807, ARIZONA REVISED STATUTES; AMENDING TITLE 33, CHAPTER6.1, ARTICLE 1, ARIZONA REVISED STATUTES, BY ADDING SECTION 33-807.02;RELATING TO FORECLOSURE OF DEEDS OF TRUST.(TEXT OF BILL BEGINS ON NEXT PAGE)
 
HB 2642- 1 -Be it enacted by the Legislature of the State of Arizona:1Section 1. Section 33-807, Arizona Revised Statutes, is amended to2read:333-807.Sale of trust property; power of trustee; foreclosure4 of trust deed 5A. By virtue ofhis THE TRUSTEE'Sposition, a power of sale is6 conferred upon the trustee of a trust deed under which the trust property may7be sold, in the manner provided in this chapter, after a breach or default in8performance of the contract or contracts, for which the trust property is9conveyed as security, or a breach or default of the trust deed. At the10option of the beneficiary, a trust deed may be foreclosed in the manner11provided by law for the foreclosure of mortgages on real property in which12event chapter 6 of this title governs the proceedings. The beneficiary or13trustee shall constitute the proper and complete party plaintiff in any14action to foreclose a deed of trust. The power of sale may be exercised by15the trustee without express provision therefor in the trust deed.16B. The trustee or beneficiary may file and maintain an action to17foreclose a deed of trust at any time before the trust property has been sold18under the power of sale. A sale of trust property under the power of sale19shall not be held after an action to foreclose the deed of trust has been20filed unless the foreclosure action has been dismissed.21C. The trustee or beneficiary may file an action for the appointment22of a receiver according to sections 12-1241 and 33-702. The right to23appointment of a receiver shall be independent of and may precede the24exercise of any other right or remedy.25D.EXCEPT FOR OWNER-OCCUPIED RESIDENTIAL PROPERTY,the power of sale26 of trust property conferred upon the trustee shall not be exercised before27the ninety-first day after the date of the recording of the notice of the28sale. The sale shall not be set for a Saturday or legal holiday. The29trustee may schedule more than one sale for the same date, time and place. 30E. FOR OWNER-OCCUPIED RESIDENTIAL PROPERTY, THE POWER OF SALE OF TRUST31PROPERTY CONFERRED UPON THE TRUSTEE SHALL NOT BE EXERCISED BEFORE THE32RECORDING OF THE NOTICE FROM THE COURT AS PROVIDED IN SECTION 33-807.02,33SUBSECTION F THAT THE MEDIATION PROCESS HAS BEEN SATISFACTORILY COMPLETED.34E. F.The trustee need only be joined as a party in legal actions35 pertaining to a breach of the trustee's obligation under this chapter or36under the deed of trust. Any order of the court entered against the37beneficiary is binding upon the trustee with respect to any actions that the38trustee is authorized to take by the trust deed or by this chapter. If the39trustee is joined as a party in any other action, the trustee is entitled to40be immediately dismissed and to recover costs and reasonable attorney fees41from the person joining the trustee.42
 
HB 2642- 2 -Sec. 2. Title 33, chapter 6.1, article 1, Arizona Revised Statutes, is1amended by adding section 33-807.02, to read:233-807.02. Mandatory foreclosure mediation; fee; report; stay;3 applicability; program termination 4A. THE MANDATORY FORECLOSURE MEDIATION PROGRAM IS ESTABLISHED IN THE5ADMINISTRATIVE OFFICE OF THE COURTS. THE SUPREME COURT SHALL OVERSEE THE6MANDATORY FORECLOSURE MEDIATION PROGRAM TO PROVIDE MEDIATION IN THE SUPERIOR7COURT FOR NONJUDICIAL FORECLOSURES OF DEEDS OF TRUST ON OWNER-OCCUPIED8RESIDENTIAL PROPERTY.9B. THE PROGRAM SHALL ADDRESS ALL ISSUES OF FORECLOSURE, INCLUDING10REINSTATEMENT OF THE DEED OF TRUST, MODIFICATION OF THE LOAN AND11RESTRUCTURING OF THE DEBT. MEDIATIONS CONDUCTED PURSUANT TO THE PROGRAM12SHALL USE THE CALCULATIONS, ASSUMPTIONS AND FORMS THAT ARE ESTABLISHED BY THE13FEDERAL DEPOSIT INSURANCE CORPORATION AND PUBLISHED IN THE FEDERAL DEPOSIT14INSURANCE CORPORATION LOAN MODIFICATION PROGRAM GUIDE AS SET OUT ON THE15FEDERAL DEPOSIT INSURANCE CORPORATION'S PUBLICLY ACCESSIBLE WEBSITE.16COMMUNICATIONS DURING MEDIATION ARE CONFIDENTIAL AND MAY NOT BE USED IN ANY17SUBSEQUENT LEGAL PROCEEDINGS. THE TRUSTOR'S, TRUSTEE'S AND BENEFICIARY'S18RIGHTS IN THE NONJUDICIAL FORECLOSURE ARE NOT WAIVED BY PARTICIPATING IN THE19PROGRAM.20C. THE SUPERIOR COURT SHALL PROVIDE MEDIATION SERVICES UNDER THIS21SECTION. THE COURT SHALL ESTABLISH A FEE FOR MEDIATION SERVICES TO BE PAID22FOR BY THE BENEFICIARY. THE COURT MAY ESTABLISH A TRAINING PROGRAM FOR23MEDIATORS AND REQUIRE THAT MEDIATORS RECEIVE THAT TRAINING BEFORE BEING24APPOINTED. THE COURT SHALL ASSIGN MEDIATORS WHO:251. ARE TRAINED IN MEDIATION AND ALL RELEVANT ASPECTS OF THE LAW.262. HAVE KNOWLEDGE OF COMMUNITY-BASED RESOURCES THAT ARE AVAILABLE IN27THE JUDICIAL DISTRICTS IN WHICH THEY SERVE.283. HAVE KNOWLEDGE OF MORTGAGE ASSISTANCE PROGRAMS.294. ARE TRAINED IN USING THE RELEVANT FEDERAL DEPOSIT INSURANCE30CORPORATION FORMS AND WORKSHEETS.31D. A MEDIATOR SHALL INCLUDE IN THE MEDIATION PROCESS UNDER THIS32SECTION ANY PERSON THE MEDIATOR DETERMINES IS NECESSARY FOR EFFECTIVE33MEDIATION. MEDIATION AND APPEARANCE IN PERSON ARE MANDATORY FOR:341. THE BENEFICIARY, EXCEPT THAT THE BENEFICIARY MAY PARTICIPATE BY35TELEPHONE. A REPRESENTATIVE OF THE BENEFICIARY MUST HAVE SUFFICIENT36AUTHORITY TO AGREE TO A PROPOSED SETTLEMENT, LOAN MODIFICATION OR DISMISSAL37OF THE LOAN.382. THE TRUSTOR AND ANY COUNSEL FOR THE TRUSTOR.393. THE TRUSTEE, EXCEPT THAT THE TRUSTEE MAY PARTICIPATE BY TELEPHONE.40E. THE PARTIES SHALL MEDIATE AND ATTEMPT TO RESOLVE THE ISSUES IN THE41FORECLOSURE. THE MEDIATOR SHALL ENSURE THAT THE PARTIES COMPLETE IN FULL AND42IN GOOD FAITH THE NET PRESENT VALUE WORKSHEET IN THE FEDERAL DEPOSIT43INSURANCE CORPORATION LOAN MODIFICATION PROGRAM GUIDE. THE MEDIATOR SHALL44RETAIN A COPY OF THE WORKSHEET UNTIL COMPLETION OF THE FORECLOSURE45

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