PRINTER'S NO. 290
No. 269 Session of 1987
INTRODUCED BY DeLUCA, IRVIS, MANDERINO, F. TAYLOR, O'DONNELL,
ITKIN, COWELL, PISTELLA, TRELLO, PETRONE, DAWIDA, DUFFY,
KUKOVICH, GAMBLE, GRUPPO, LEVDANSKY, MARKOSEK, CESSAR,
MAYERNIK, MICHLOVIC, MURPHY, OLASZ, WOZNIAK, VEON, CARN,
PETRARCA, DEAL, LINTON, EVANS, ROEBUCK, FREEMAN, DOMBROWSKI,
COLE, SEVENTY, VAN HORNE, CLARK, PRESTON, RIEGER, BELFANTI,
McHALE, COLAFELLA, HARPER, FEE, MELIO, TRUMAN, FATTAH,
DeWEESE, CORRIGAN, LaGROTTA, OLIVER, KASUNIC, DALEY, COHEN,
McCALL, RICHARDSON, BURNS, YANDRISEVITS, PIEVSKY, LAUGHLIN,
CAPPABIANCA, BELARDI, BLAUM, TIGUE, JAROLIN, ACOSTA,
CALTAGIRONE, BOOK, LANGTRY, FARMER, WIGGINS, MRKONIC,
KOSINSKI AND JOSEPHS, FEBRUARY 10, 1987
REFERRED TO COMMITTEE ON BUSINESS AND COMMERCE,
FEBRUARY 10, 1987
AN ACT
1 Providing for sheriff's sales of residential property.
2 The General Assembly of the Commonwealth of Pennsylvania
3 hereby enacts as follows:
4 Section 1. Short title.
5 This act shall be known and may be cited as the Sheriff's
6 Sale Equity Protection Act.
7 Section 2. Definitions.
8 The following words and phrases when used in this act shall
9 have the meanings given to them in this section unless the
10 context clearly indicates otherwise:
11 "Appraised value." The preliminary value or, if an appraisal
12 is requested under this act, the value as established by an
1 appraiser, minus the amount of all undischarged liens. If a
2 party disagrees with the value established by the court-
3 appointed appraiser, the party may, at its expense, present to
4 the court other evidence of value, including other appraisals,
5 as it deems appropriate; and the appraised value shall be the
6 value as determined by the court following its consideration and
7 hearing of the additional evidence.
8 "Appraiser." A licensed, qualified, independent real estate
9 appraiser selected from a list of approved appraisers
10 promulgated annually by the president judge of the court of
11 common pleas of the county in which the residence is located and
12 containing not less than a number of appraisers equal to 10% of
13 the average number of properties sold by sheriff's sale during
14 the previous year in the county. To be eligible for inclusion on
15 the list, an appraiser must be qualified and approved to
16 appraise residential real estate for the Federal Housing
17 Administration, the Federal National Mortgage Association and
18 the Federal Home Loan Mortgage Corporation. If it is impossible
19 to obtain the required number of appraisers for the list, the
20 court shall appoint a smaller number.
21 "Final value." The appraised value.
22 "Preliminary value." The value obtained for the residence
23 by:
24 (1) adjusting the assessed value or, where the
25 assessment includes other real estate, a commensurate part of
26 the assessed value of the residence for local real estate tax
27 purposes by the common level ratio of assessed values to
28 market values of the taxing district as established and most
29 recently published by the State Tax Equalization Board; and
30 (2) subtracting from the adjusted value the amount of
19870H0269B0290 - 2 -
1 undischarged liens.
2 "Residence." Real property containing two or fewer
3 residential units, at least one of which is occupied by the
4 record owner of the real estate.
5 "Sale price." The greater of the amount bid by the
6 successful bidder at a sheriff's sale or the amount of all
7 liens, including the lien of the levying creditor, which are
8 discharged from the real estate by the sale, regardless of any
9 right of redemption following such sale.
10 "Undischarged lien." A lien not discharged from the real
11 estate sold at sheriff's sale, including, without limitation,
12 liens for taxes, municipal claims and other priority items not
13 paid out of the proceeds of sale and senior mortgage liens
14 which, by law, are not discharged by the sale.
15 Section 3. Notice for sheriff's sales of residences.
16 (a) General rule.--At least 30 days prior to a sheriff's
17 sale of a residence, the plaintiff or the plaintiff's attorney
18 shall file a certification with the prothonotary showing that
19 the notice under subsection (b) has either been delivered to a
20 sheriff for service on the owner of the residence with the
21 notice of sheriff's sale or has been sent by the plaintiff or
22 the plaintiff's attorney to the owner of the residence by
23 ordinary mail, with the United States Postal Service Certificate
24 of Mailing, addressed to the residence.
25 (b) Form.--The notice under this section shall be on a form
26 bearing no letterhead and shall read:
27 (Caption of Case)
28 IMPORTANT NOTICE ABOUT YOUR RIGHT TO GET
29 A FAIR PRICE FOR YOUR HOUSE IF IT IS SOLD
30 AT SHERIFF'S SALE.
19870H0269B0290 - 3 -
1 Your home at --------------------,
2 --------------------, Pennsylvania, has or will be listed
3 for sheriff's sale to satisfy a judgment held by
4 --------------- (Plaintiff) which was entered
5 --------------- (date), in the amount of $---------------
6 . Under the Sheriff's Sale Equity Protection Act, the
7 sale price of your property at the sheriff's sale (as
8 defined in the act) must be more than 60% of the value
9 determined under the act or the sale will not be
10 completed. After the sheriff's sale, you will receive
11 notice of the sale price and your rights under the act.
12 (c) Exemption.--No notice need be sent under this subsection
13 in sheriff's sales of properties which are not residences or
14 which are exempt from this act under section 6. In such cases,
15 the plaintiff shall certify that the property is not a residence
16 as defined in section 2 or is exempt under section 6.
17 Section 4. Procedure for sheriff's sale.
18 (a) General rule.--Except as provided in subsection (f), no
19 sheriff's sale of a residence shall be valid unless the amount
20 of the sale price is at least 60% of the final value of the
21 residence. Within ten days following the sheriff's sale, the
22 plaintiff or the plaintiff's attorney shall file a certification
23 with the sheriff showing a calculation of preliminary value of
24 the residence; to the best of such certifier's knowledge, a
25 schedule of undischarged and discharged liens; a calculation of
26 the sale price; and that the notice required by subsection (b)
27 has been sent. Absent certification, the sheriff shall mark the
28 sale "terms of sale not complied with" and may not deliver a
29 deed pursuant to the sale. The amount of the discharged and
30 undischarged liens on the certificate shall be based upon the
19870H0269B0290 - 4 -
1 real estate records for the liens as of the date of the writ of
2 execution and shall be in that face amount of the liens or in an
3 amount as calculable from the records. The plaintiff shall not
4 be required to search or make inquiry beyond the record.
5 (b) Notice.--Within ten days following a sheriff's sale of a
6 residence, the plaintiff or the plaintiff's attorney shall send
7 notice to the owner on a form bearing no letterhead and reading
8 as follows:
9 (Caption of Case)
10 Important Notice of Rights Under Sheriff's
11 Sale Equity Protection Act.
12 Your house at (address) was sold at sheriff's sale on
13 --------------- (date). The sale price of your house at
14 such sale was $---------------. (Use following sentence
15 only if "sale price" is based not on the amount bid, but
16 rather on the amount of discharged liens.) Such sale
17 price is based on the following liens against your
18 property which are discharged by the sale:
19 Name of Creditor Amount
20 Total (Including plaintiff's claim) ---------------
21 According to county tax records, the fair market
22 value of your house has been estimated as
23 $---------------, less $---------------, representing the
24 following liens which were not discharged by the sale and
25 therefore continue against the property:
26 Name of Creditor Amount
19870H0269B0290 - 5 -
1 Total Undischarged Liens ---------------
2 Accordingly, the preliminary value of your home is
3 $--------------- representing the estimated fair market
4 value less such undischarged liens. If you disagree with
5 that preliminary value and believe its value is more than
6 $--------------- (insert figure which is 1.67 times the
7 sale price), you have the right to ask the Court of
8 Common Pleas of --------------- County to appoint an
9 appraiser to inspect your property at your expense and
10 submit an estimate of value to the court. In order to
11 exercise your rights, you must return to the Sheriff of
12 --------------- County the form at the end of this
13 notice, together with a certified check, cashier's check
14 or money order for $--------------- to cover the cost of
15 such appraisal. Such request form and payment must be
16 actually received by the sheriff within 15 days from the
17 date of this letter.
18 If you return the request form and payment within 15
19 days, the court will appoint an independent appraiser who
20 will, within 30 days, perform an appraisal, file a copy
21 with the court and send you and the Plaintiff copies. You
22 must make your home available to be inspected by such
23 appraiser, as well as any appraiser designated by the
24 Plaintiff, at a reasonably convenient time. If you fail
25 to allow your home to be inspected by either appraiser
26 upon request, your rights to an appraisal hereunder shall
27 be terminated.
28 If you or the Plaintiff disagree with the value
29 determined by the court-appointed appraiser, you can
30 request a hearing and present additional evidence of
19870H0269B0290 - 6 -
1 value. In that case, the court shall determine the
2 "appraised value" for the purpose of the sheriff's sale
3 of your home. If you do not ask for an appraisal, the
4 preliminary value set forth above shall be deemed to be
5 the value of your home.
6 Also, if you want to challenge the amount of the
7 liens listed above, you must complete the second part of
8 the return form attached and return that form to the
9 sheriff within 15 days, and the court will schedule a
10 hearing to decide if they are correct. You will be
11 notified of the date and time of the hearing.
12 RETURN FORM
13 TO REQUEST AN APPRAISAL, COMPLETE THE FOLLOWING
14 INFORMATION AND ENCLOSE THE APPROPRIATE AMOUNT:
15 I request an appraisal of my home located at
16 ------------------------------, -----------------, and
17 enclose my payment of $--------------- by (circle one)
18 certified check, cashier's check, money order payable to
19 the order of the Sheriff of --------------- County,
20 representing the appraisal fee. I agree to allow my home
21 to be inspected at a reasonably convenient time between
22 the hours of 9 a.m. and 8 p.m. Monday through Saturday by
23 the court-appointed appraiser as well as any appraiser
24 appointed by the Plaintiff. An appointment to inspect my
25 home can be made by calling me at ---------------. I
26 hereby certify that I own the above real estate, such
27 real estate is one-family or two-family property, and I
28 live in the property as may primary residence.
29 ---------------
30 (Signature)
19870H0269B0290 - 7 -
1 TO CHALLENGE THE AMOUNT OF THE LIENS LISTED ON THIS
2 NOTICE COMPLETE THE FOLLOWING:
3 I disagree with the following liens stated in the
4 notice against my property:
5 Name of Creditor Amount I Think Is Owed
6 I hereby certify that I own the above real estate,
7 such real estate is one-family or two-family property,
8 and I live in the property as my primary residence. I
9 request a hearing on the amount of the liens.
10 ---------------
11 (Signature)
12 TO PROTECT YOUR RIGHTS, THIS FORM SHOULD BE RETURNED TO
13 THE SHERIFF OF --------------- COUNTY AT ---------------
14 --------------- (Address).
15 (c) Cost of appraisal.--If the sale price calculated by the
16 plaintiff is less than 80% of the preliminary value, the first
17 $50 of the cost of the appraisal shall be borne by the owner;
18 and the balance shall be paid by the sheriff out of sheriff
19 commissions and other funds available to the sheriff. If the
20 sale price is 80% or more of the preliminary value, the owner
21 shall pay the entire cost of the appraisal.
22 (d) Appraiser.--If an owner of a residence returns a request
23 for an appraisal within 15 days of the date of the notice under
24 subsection (b), the sheriff shall assign the appraisal, on a
25 rotating basis, to an appraiser. Appointment shall be made
26 within three business days after receipt of the request. The
19870H0269B0290 - 8 -
1 appraisal shall be completed on the standard FNMA/FHLMC
2 appraisal form and be submitted by the appraiser to the sheriff,
3 with copies for the levying creditor and the defendant, within
4 30 days of appointment. If the owner does not permit the
5 appraisal to be made, the appraiser shall report this fact to
6 the sheriff, with copies to the plaintiff and owner. The
7 appraiser shall attach to all copies of the appraisal report,
8 including a report that the owner refused to cooperate, a notice
9 reading:
10 NOTICE
11 If you disagree with this report, you must request a
12 hearing within ten days of the date of this notice to
13 present evidence that it is not correct. You may request
14 a hearing by filing the attached form with the sheriff's
15 office at -------------------- (address).
16 DATE ---------------.
17 RETURN FORM
18 I disagree with the report of the appraiser regarding
19 -------------------- (address of property). I request a
20 hearing to determine whether the report is correct.
21 ---------------
22 (Signature)
23 (e) Hearing.--If a hearing is requested by either party
24 contesting the liens under subsection (b) or contesting the
25 appraiser's report under subsection (d) within 15 days of the
26 notice under subsection (b), or within ten days of the notice
27 under subsection (d), the request shall be deemed a contested
28 motion and shall be scheduled for a hearing to be held within 30
29 days after request. If the owner has requested a hearing under
30 subsection (b) and also requested an appraisal, the hearing may
19870H0269B0290 - 9 -
1 be held within 40 days after the appraisal report so that, if a
2 challenge is made to the appraisal report, both matters shall be
3 heard together. At the hearing the court shall determine the
4 final value and sale price, and whether the sale complies with
5 subsection (a). The party requesting the presence of the court-
6 appointed appraiser shall pay the appraiser's fees for
7 appearance.
8 (f) Relisting.--If a sheriff's sale of a residence is
9 invalidated under subsection (a) or (e), the plaintiff shall
10 have the right to relist the property for sale for any date more
11 than 179 days after the invalidated sale, the sheriff shall
12 promptly send the homeowner a notice, by ordinary mail, reading:
13 NOTICE THAT SHERIFF'S SALE WAS NOT VALID
14 The sheriff's sale of your residence held on (date)
15 was not completed because the sale price was not at least
16 60% of the final value of your residence, as required by
17 the Sheriff's Sale Equity Protection Act. However, the
18 creditor may reschedule a sheriff's sale of your
19 residence to be held any time after ---------------
20 (insert date which is 179 days after invalidated sale),
21 and the rescheduled sale cannot be set aside because of
22 sale price no matter how low the price may be at that
23 sale. If you wish to get the benefit of the value of your
24 home, you should act promptly.
25 TO FIND OUT DIFFERENT ACTIONS YOU CAN TAKE, YOU MAY WANT
26 TO CONSULT A LAWYER. IF YOU DO NOT HAVE A LAWYER OR
27 CANNOT AFFORD ONE, GO TO OR TELEPHONE THE OFFICE LISTED
28 BELOW TO FIND OUT WHERE TO GET LEGAL HELP.
29 (Address and phone number of Lawyer's Reference Service
30 for County).
19870H0269B0290 - 10 -
1 At the second sale, the notices and certifications required by
2 section 3 and this section shall not be required, and the
3 property shall be sold at the second sale to the highest bidder,
4 regardless of the amount of the sale price in relation to the
5 value of the residence.
6 (g) Deeds.--In a sale valid under this act, the sheriff may
7 not deliver a deed until after the following dates:
8 (1) If no appraisal is requested by the owner, and if
9 the owner does not contest the statement of liens, 15 days
10 after the date of the notice sent under subsection (b).
11 (2) If an appraisal is requested, the owner does not
12 contest the statement of liens and no party contests the
13 appraisal report, ten days after the submission and mailing
14 of the appraisal report.
15 (3) If a hearing is requested, five days after the
16 court's determination of the final value.
17 (h) Appraisal reports.--The appraisal report under
18 subsection (d) shall be kept on file by the sheriff and shall be
19 available for inspection by the public during the sheriff's
20 regular business hours until the sheriff's deed to the property
21 has been delivered. Thereafter, the appraisal report shall be
22 stored or disposed of in accordance with the regulations for the
23 retention of other sheriff's records.
24 Section 5. Costs of sheriff's sale.
25 (a) Advertising for invalidated sales.--The cost of
26 advertising invalidated sheriff's sales shall be an allowable
27 court cost collectible under the judgment.
28 (b) Interest.--Interest shall be allowed, to the extent the
29 funds held by the sheriff are sufficient, through the date of
30 actual distribution by the sheriff. If the lien being paid by
19870H0269B0290 - 11 -
1 the sheriff is a mortgage or deed of trust, interest shall be
2 allowed at the higher of:
3 (1) the interest rate provided in the instrument
4 evidencing the indebtedness, applied to the outstanding
5 principal amount of the indebtedness; or
6 (2) at the highest rate allowed by law for judgments.
7 (c) Purchased by plaintiff.--If the plaintiff is the
8 successful bidder at the sheriff's sale, no poundage or
9 sheriff's commission may be charged by the sheriff on the amount
10 of the plaintiff's bid except to the extent that the bid exceeds
11 plaintiff's claim plus costs and other priority claims.
12 (d) Deposits.--If the successful bid at a sheriff's sale is
13 less than $2,000, the successful bidder shall deposit 5% of the
14 bid with the sheriff. If the successful bid at a sheriff's sale
15 is $2,000 or more, the successful bidder shall deposit the
16 greater of 5% of the bid or $2,000 with the sheriff. This
17 subsection does not apply if the successful bidder is the
18 plaintiff.
19 (e) Balance.--The successful bidder shall be allowed 60 days
20 following the sale to pay the remainder of its bid to the
21 sheriff. Unless the plaintiff agrees to a further extension of
22 the 60-day period, if the successful bidder does not deposit the
23 remainder of its bid within 60 days, the bidder's deposit shall
24 be forfeited and applied first to reimburse the plaintiff for
25 the expenses of the defaulted sale; second to the expenses of
26 relisting the property for sale, if the property is relisted by
27 the plaintiff; and third to pay the plaintiff. The sheriff shall
28 mark the defaulted sale "terms of sale not complied with."
29 Section 6. Exemptions.
30 The provisions of sections 3 and 4 do not apply to sheriff's
19870H0269B0290 - 12 -
1 sales by creditors who are one of the following:
2 (1) Individuals, estates or trusts for the benefit of
3 individuals.
4 (2) Persons who:
5 (i) did not hold nor extend five or more loans
6 secured by residences in the preceding year; and
7 (ii) did not hold nor extend 25 or more loans not
8 secured by real estate in the preceding year.
9 Section 7. Waiver.
10 The protections of this act may not be waived by an owner
11 except by failure of the owner to take advantage of the rights
12 under this act.
13 Section 8. Application.
14 This act shall not apply to writs of execution filed more
15 than three years after the act takes effect.
16 Section 9. Effective date.
17 This act shall take effect in 90 days.
A21L42JLW/19870H0269B0290 - 13 -