PRINTER'S NO. 2522

THE GENERAL ASSEMBLY OF PENNSYLVANIA


SENATE BILL

No. 1616 Session of 2008


        INTRODUCED BY GREENLEAF, RAFFERTY, COSTA, ERICKSON AND FONTANA,
           NOVEMBER 18, 2008

        REFERRED TO URBAN AFFAIRS AND HOUSING, NOVEMBER 18, 2008

                                     AN ACT

     1  Amending the act of December 3, 1959 (P.L.1688, No.621),
     2     entitled, as amended, "An act to promote the health, safety
     3     and welfare of the people of the Commonwealth by broadening
     4     the market for housing for persons and families of low and
     5     moderate income and alleviating shortages thereof, and by
     6     assisting in the provision of housing for elderly persons
     7     through the creation of the Pennsylvania Housing Finance
     8     Agency as a public corporation and government
     9     instrumentality; providing for the organization, membership
    10     and administration of the agency, prescribing its general
    11     powers and duties and the manner in which its funds are kept
    12     and audited, empowering the agency to make housing loans to
    13     qualified mortgagors upon the security of insured and
    14     uninsured mortgages, defining qualified mortgagors and
    15     providing for priorities among tenants in certain instances,
    16     prescribing interest rates and other terms of housing loans,
    17     permitting the agency to acquire real or personal property,
    18     permitting the agency to make agreements with financial
    19     institutions and Federal agencies, providing for the purchase
    20     by persons of low and moderate income of housing units, and
    21     approving the sale of housing units, permitting the agency to
    22     sell housing loans, providing for the promulgation of
    23     regulations and forms by the agency, prescribing penalties
    24     for furnishing false information, empowering the agency to
    25     borrow money upon its own credit by the issuance and sale of
    26     bonds and notes and by giving security therefor, permitting
    27     the refunding, redemption and purchase of such obligations by
    28     the agency, prescribing remedies of holders of such bonds and
    29     notes, exempting bonds and notes of the agency, the income
    30     therefrom, and the income and revenues of the agency from
    31     taxation, except transfer, death and gift taxes; making such
    32     bonds and notes legal investments for certain purposes; and
    33     indicating how the act shall become effective," establishing


     1     mortgage foreclosure assistance programs and residential
     2     mortgage foreclosure conciliation programs.

     3     The General Assembly of the Commonwealth of Pennsylvania
     4  hereby enacts as follows:
     5     Section 1.  The act of December 3, 1959 (P.L.1688, No.621),
     6  known as the Housing Finance Agency Law, is amended by adding
     7  articles to read:
     8                            ARTICLE IV-D
     9              MORTGAGE FORECLOSURE ASSISTANCE PROGRAMS
    10  Section 401-D.  Home mortgage foreclosure assistance programs.
    11     (a)  Establishment.--The agency shall establish programs
    12  directed at mortgagors facing mortgage foreclosure on their
    13  primary residence.
    14     (b)  Programs.--The programs established by the agency under
    15  subsection (a) shall assist mortgagors in recasting or adjusting
    16  their current mortgage or refinancing their mortgage debt with a
    17  new mortgage financed by the agency, in an effort to extend the
    18  length of the loan, lower the interest rate, or providing other
    19  similar relief.
    20     (c)  Eligibility requirements.--Any home mortgage foreclosure
    21  assistance program established under this section or any
    22  existing program shall be available regardless of income. In
    23  addition, the primary residence must be located in this
    24  Commonwealth and be a one-family or two-family, owner-occupied
    25  structure.
    26  Section 402-D.  Agency guidelines.
    27     Within 60 days of the effective date of this article, the
    28  agency shall publish guidelines in the Pennsylvania Bulletin to
    29  administer the provisions of this article.
    30                            ARTICLE IV-E

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     1       RESIDENTIAL MORTGAGE FORECLOSURE CONCILIATION PROGRAMS
     2  Section 401-E.  Conciliation programs.
     3     (a)  Program creation.--The court of common pleas in each
     4  county shall establish a residential mortgage foreclosure
     5  conciliation program to assist mortgagors and mortgagees in
     6  achieving a mutually agreeable resolution to a mortgage
     7  foreclosure action.
     8     (b)  Model guidelines.--The Supreme Court shall, in
     9  consultation with the agency, develop model guidelines for the
    10  implementation of this article.
    11     (c)  Eligibility requirements.--
    12         (1)  All mortgage foreclosure actions involving primary
    13     residences which are subject to execution to enforce a
    14     residential mortgage shall be scheduled for a conciliation
    15     conference. The property must be located in this Commonwealth
    16     and be a one-family or two-family, owner occupied structure.
    17         (2)  Mortgage foreclosure actions involving real property
    18     which is neither owner-occupied nor residential does not
    19     qualify for a conciliation conference under this article.
    20  Section 402-E.  Complaint and notification.
    21     Once a mortgage foreclosure action is initiated by a
    22  mortgagee with the filing of a complaint in the county
    23  prothonotary's office, the service of the complaint shall
    24  include a notice from the court of common pleas informing the
    25  mortgagor of the court's residential mortgage foreclosure
    26  conciliation program and provide a scheduled date and time of
    27  the conciliation conference. The court shall simultaneously send
    28  a copy of the notice to the mortgagee and the agency.
    29  Section 403-E.  Conciliation conference.
    30     (a)  Presiding officer.--The conciliation conference shall be
    20080S1616B2522                  - 3 -     

     1  conducted by a civil case manager or other person designated by
     2  the court, a judge pro temp who possesses experience in the
     3  subject matter or a judge of the court of common pleas.
     4     (b)  Issues to be addressed.--The conciliation conference
     5  shall address all issues of foreclosure, including:
     6         (1)  Whether the mortgagor is represented and if not
     7     represented, whether volunteer counsel may be available and
     8     appointed.
     9         (2)  Whether the mortgagor met with a representative of a
    10     consumer credit counseling agency.
    11         (3)  Whether the consumer credit counseling agency
    12     prepared an assessment or report providing options to help
    13     resolve the foreclosure action.
    14         (4)  Copies of any completed application for mortgage or
    15     financial assistance.
    16         (5)  Mortgagor's income and expense information.
    17         (6)  Mortgagor's employment status.
    18         (7)  Restructuring of the mortgage debt.
    19         (8)  Whether the case may proceed to sheriff sale since
    20     there is no prospect of an amicable resolution.
    21     (c)  Effect of failure to attend conference.--If a mortgagor
    22  fails to appear for the mandatory conciliatory conference, the
    23  requirement for the conference shall be deemed satisfied upon
    24  verification that the required notice was served, and if so, an
    25  order shall be issued authorizing the mortgagee to proceed with
    26  the action.
    27     (d)  Reporting to agency.--The court shall notify the agency
    28  of the outcome of the conciliation conference in a format
    29  developed by the agency.
    30  Section 404-E.  Sheriff sale.
    20080S1616B2522                  - 4 -     

     1     Notwithstanding any other provision of law to the contrary,
     2  primary residences which are subject to execution to enforce a
     3  residential mortgage cannot proceed to a sheriff sale until a
     4  conciliation conference is held or the mortgagor fails to appear
     5  for the conference as set forth in subsection (c).
     6     Section 2.  This act shall take effect in 60 days.
















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