Oregon Loan Modification Laws and Regulations

Oregon Loan Modification Laws and Rules

Senate Bill 628, passed by the 2009 Oregon Legislature, requires lenders to meet with borrowers facing foreclosure – either in person or by phone – and evaluate whether they qualify for a loan modification. A loan modification could help borrowers lower their monthly payments and keep their home.

Starting Sept. 28, foreclosure notices that are sent to homeowners who are late on their mortgage payments include new information about how to meet with their lender and how to request a loan modification. If the borrower requests it, lenders must meet with borrowers or show that they evaluated the borrower for a loan modification before foreclosing on the home.
Oregonians who are seriously behind on their mortgage payments should watch their mail for the new foreclosure notice. Once they receive the notice, they should immediately take the following steps:

Call their lender to set up a meeting to discuss a loan modification.
Fill out the loan modification request form provided in the notice.

Homeowners should act fast – they have 30 days from the date of the foreclosure notice to request a loan modification.

For more information, homeowners can call the Department of Consumer and Business Services, Division of Finance and Corporate Securities, at 503-947-7854 or call 1-800-SAFENET to be referred to a foreclosure counselor.

Foreclosure consultants must provide a homeowner with a written contract with plain language disclosures and are prohibited from receiving any interest in the home in foreclosure. The foreclosure consulting contract must include a full description of services to be provided and the total costs of the contract.
The law requires equity purchasers to provide the homeowner with a written contract in plain language. If applicable, it requires equity purchasers to ensure the homeowner has the ability to buy back the home while it’s in the foreclosure process or if the process has been stopped; it entitles the homeowner to a share of proceeds if the home is re-sold quickly; and it requires the transfer to take place in escrow.

The homeowner has the right to cancel a foreclosure consulting or an equity purchasing contract. 

The law also does not permit consultants to impose upon homeowners conditions, such as the waiver of their rights, or use an arbitrator to mediate or decide about possible disputes. Any disputes must be conducted under the jurisdiction of Oregon law.

You must register with the Corporation Division of the Oregon Secretary of State.