Georgia Loan Modification Laws and Regulations

State of Georgia Loan Modification Laws and Rules

On May 13, 2008 Governor Sonny Perdue signed into law Senate Bill 531. The bill increases the notice to a homeowner before a lender can foreclose.

SB 531 lengthens the notice period from 15 days to at least 30 days prior to the scheduled foreclosure sale.

SB 531 also requires that the certified letter giving the homeowner notice of the foreclosure sale include the name, address, and telephone number of the “individual or entity who shall have full authority to negotiate, amend, and modify all terms of the mortgage with the debtor.” This provision of the bill is important because when homeowners are negotiating with their servicers, they often do not know what entity actually owns their loan. Sometimes a servicer will refuse to offer the homeowner a loan modification or other workout, claiming that they lack authority to do so. If the homeowner wants to reach the company that ultimately has the authority to accept any workout agreement, or if the homeowner wants to pursue a legal claim related to their mortgage loan, he or she needs to know the identity of the current holder of the mortgage loan. This bill requires that identity to be disclosed.

Lastly, SB 531 requires that the current holder of the mortgage loan record the assignment of the security deed, which shows the present owner of the mortgage loan, in the public deed records before conducting the foreclosure sale.

'Mortgage loan originator' means an individual who for compensation or gain or in the expectation of compensation or gain takes a residential mortgage loan application or offers or negotiates terms of a residential mortgage loan. Generally, this does not include an individual engaged solely as a loan processor or underwriter except as otherwise provided in paragraph (5) of subsection (a) of Code Section 7-1-1002; a person or entity that only performs real estate brokerage activities and is licensed or registered in accordance with Georgia law unless the person or entity is compensated by a mortgage lender, mortgage broker, or other mortgage loan originator or by any agent of such mortgage lender, mortgage broker, or other mortgage loan originator; and does not
include a person or entity solely involved in extensions of credit relating to time-share plans, as that term is defined in 11 U.S.C. Section 101(53D).