75th OREGON LEGISLATIVE ASSEMBLY--2010 Special Session
Enrolled
House Bill 3656
Sponsored by COMMITTEE ON CONSUMER PROTECTION AND GOVERNMENT
ACCOUNTABILITY
CHAPTER ................
AN ACT
Relating to sales of foreclosed property; creating new
provisions; amending ORS 86.770; 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) If, under ORS 86.705 to 86.795, a trustee sells
property covered by a trust deed, the trustee's sale forecloses
and terminates the interest in the property that belongs to a
person { - that received - } { + to which + } notice of the
sale { + was given + } under ORS 86.740 and 86.750 or to a
person that claims an interest by, through or under the person
{ - that received - } { + to which + } notice { + was
given + }. A person whose interest the trustee's sale foreclosed
and terminated may not redeem the property from the purchaser at
the trustee's sale. A failure to give notice to a person entitled
to notice does not affect the validity of the sale as to persons
that were notified.
(2) Except in accordance with subsection (4) of this section,
after a trustee's sale under ORS 86.705 to 86.795 { + , + } or
after a judicial foreclosure of a residential trust deed, an
action for a deficiency may not be brought or a judgment entered
against the grantor, the grantor's successor in interest or
another person obligated on:
(a) The note, bond or other obligation secured by the
{ - residential - } trust deed for the property that was
subject to the trustee's sale or the { + judicial + }
foreclosure; or
(b) Any other note, bond or other obligation secured by a
residential trust deed for, or mortgage on, the property that was
subject to the trustee's sale or the { + judicial + }
foreclosure when the debt, of which the note, bond or other
obligation is evidence:
{ - (A) Was created at the same time as the note, bond or
other obligation secured by the foreclosed residential trust
deed; and - }
{ - (B) Is owed to the beneficiary in the residential trust
deed that was subject to the trustee's sale or the
foreclosure. - }
{ + (A) Was created on the same day as, and used as part of
the same purchase or repurchase transaction as, the note, bond or
other obligation secured by the foreclosed residential trust
deed; and
Enrolled House Bill 3656 (HB 3656-A) Page 1
(B) Is owed to or was originated by the beneficiary or an
affiliate of the beneficiary in the residential trust deed that
was subject to the trustee's sale or the foreclosure. + }
(3) Notwithstanding ORS 88.070, in a judicial foreclosure of a
trust deed that is not a residential trust deed the judgment must
provide that if the sale proceeds are insufficient to satisfy the
judgment, execution may issue for 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) This section does not preclude:
(a) An action that forecloses, judicially or nonjudicially:
(A) Other property covered by the trust deed that is the
subject of the foreclosure; or
(B) Another trust deed, mortgage, security agreement,
consensual or nonconsensual security interest or lien that covers
other real or personal property that is also used as security for
the note, bond or other obligation that is secured by the trust
deed for the property that was sold.
(b) An action against a guarantor for a deficiency that remains
after a judicial foreclosure.
(5) A guarantor of an obligation secured by a residential trust
deed may not recover a deficiency from the grantor or a successor
in interest of the grantor.
SECTION 2. { + (1) The amendments to ORS 86.770 by section 1
of this 2010 Act apply to a trust deed or mortgage or a note,
bond or other obligation secured by a trust deed or mortgage that
was executed before, on or after the effective date of this 2010
Act.
(2)(a) The amendments to ORS 86.770 (2)(a) by section 1 of this
2010 Act apply to an action for a deficiency brought on or after
August 4, 2009.
(b) The amendments to ORS 86.770 (2)(b) by section 1 of this
2010 Act apply only to an action for a deficiency brought on or
after the effective date of this 2010 Act. + }
SECTION 3. { + This 2010 Act being necessary for the immediate
preservation of the public peace, health and safety, an emergency
is declared to exist, and this 2010 Act takes effect on its
passage. + }
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Passed by House February 15, 2010
...........................................................
Chief Clerk of House
...........................................................
Speaker of House
Passed by Senate February 20, 2010
...........................................................
President of Senate
Enrolled House Bill 3656 (HB 3656-A) Page 2
Received by Governor:
......M.,............., 2010
Approved:
......M.,............., 2010
...........................................................
Governor
Filed in Office of Secretary of State:
......M.,............., 2010
...........................................................
Secretary of State
Enrolled House Bill 3656 (HB 3656-A) Page 3