75th OREGON LEGISLATIVE ASSEMBLY--2009 Regular Session
 
NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .
 
LC 1939
 
                         House Bill 3004
 
Sponsored by Representative CLEM (at the request of Jane Cummins)
 
 
                             SUMMARY
 
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
 
  Provides that sale by trustee of foreclosed property or sale of
residential property after judicial foreclosure precludes further
action against mortgagor or grantor for deficiencies in amount
secured by mortgage or trust deed.
  Declares emergency, effective on passage.
 
                        A BILL FOR AN ACT
Relating to sales of foreclosed property; creating new
  provisions; amending ORS 86.770 and 88.070; and declaring an
  emergency.
Be It Enacted by the People of the State of Oregon:
  SECTION 1. ORS 86.770 is amended to read:
  86.770. (1) A sale made by a trustee under ORS 86.705 to 86.795
 { - shall foreclose and terminate - }  { +  forecloses and
terminates + } all interest in the property covered by the trust
deed of   { - all - } persons to whom notice is given under ORS
86.740 and 86.750 and of
  { - any - }  other   { - person - }  { +  persons + } claiming
by, through or under such persons, and such persons
 { - shall - }  have no right to redeem the property from the
purchaser at the trustee's sale. The failure to give notice to
any of these persons   { - shall - }  { +  does + } not affect
the validity of the sale as to persons so notified.
  (2) Except as provided in subsection (4) of this section,
 { - no other or further action shall - }  { +  an action may
not + } be brought  { - , nor - }  { +  or a + } judgment entered
for   { - any - }  { +  a + } deficiency  { - , - }  against the
grantor,   { - or - }  the grantor's successor in interest, if
any, { +  or another person obligated + } on the note, bond, or
other obligation secured by   { - the - }  { +  a + } trust
deed { +  granted as security for a portion of the unpaid
purchase price of the property + }   { - or against any other
person obligated on such note, bond or other obligation - }
after a sale is made:
  (a) By a trustee under ORS 86.705 to 86.795; or
  (b) Under a judicial foreclosure of a residential trust deed.
  (3) Notwithstanding ORS 88.070, when there is a judicial
foreclosure of a trust deed that is not a residential trust deed,
the judgment shall provide that if the sale proceeds are
insufficient to satisfy the judgment, execution may issue for
 
  { - any - }  { +  the + } amount by which the unpaid balance of
the obligation secured by the trust deed exceeds the net sale
proceeds payable to the beneficiary.
  (4)   { - Nothing in - }  This section   { - shall - }  { +
does not + } preclude { + :
  (a) + } An action judicially or nonjudicially foreclosing { + :
  (A) + } The same trust deed as to   { - any - }  other property
covered
  { - thereby - }  { +  by the trust deed; or
  (B) Another trust deed, mortgage, security agreement,
consensual or nonconsensual security interest or lien that covers
other real or personal property also used as security for the
note, bond or other obligation that is secured by the trust deed
for the property that was sold; or
  (b) An action against a guarantor for a deficiency that remains
following judicial foreclosure. + }
  { - , or any other trust deeds, mortgages, security agreements,
or other consensual or nonconsensual security interest or liens
covering any other real or personal property security for the
note, bond or other obligation secured by the trust deed under
which a sale has been made or an action against a guarantor to
the extent of any remaining deficiency following judicial
foreclosure. - }
   { +  (5) + } A guarantor of an obligation secured by a
residential trust deed   { - shall not have the right to - }
 { +  may not + } recover   { - any - }  { +  a + } deficiency
from the grantor or   { - any - }  { +  a + } successor in
interest of the grantor.
  SECTION 2. ORS 88.070 is amended to read:
  88.070. When real property is sold pursuant to a judgment
foreclosing a mortgage { +  that was given to secure an unpaid
portion of the purchase price of the real property + } and the
proceeds of the sale are not adequate to satisfy the amounts
secured by the mortgage, all judgment remedies for collection of
the unsatisfied amounts expire when the sale is made { + . + }
 { - if: - }
    { - (1) The mortgage was given to a seller to secure the
unpaid balance of the purchase price of real property; or - }
    { - (2) The mortgage was given after September 13, 1975, to a
person other than a seller to secure not more than $50,000 of the
unpaid balance of the purchase price of real property used by the
purchaser as the primary or secondary single family residence of
the purchaser. - }
  SECTION 3.  { + The amendments to ORS 86.770 and 88.070 by
sections 1 and 2 of this 2009 Act apply to mortgages given or
trust deeds executed on or after the effective date of this 2009
Act. + }
  SECTION 4.  { + This 2009 Act being necessary for the immediate
preservation of the public peace, health and safety, an emergency
is declared to exist, and this 2009 Act takes effect on its
passage. + }
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