Bill Text: MN HF29 | 2013-2014 | 88th Legislature | Introduced
Bill Title: Lender preforeclosure calculations required.
Sponsorship: Partisan Bill (Democrat 2)
Status: (Introduced - Dead) 2013-01-14 - Author added Kahn [HF29 Detail]
Download: Minnesota-2013-HF29-Introduced.html
1.2relating to mortgage lending; requiring lenders to make certain calculations prior
1.3to foreclosure; proposing coding for new law in Minnesota Statutes, chapter 580.
1.4BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.5 Section 1. [580.023] CERTAIN PREFORECLOSURE CALCULATIONS
1.6REQUIRED.
1.7A mortgage lender, prior to initiating a foreclosure of a mortgage on residential
1.8property, has a duty of good faith and fair dealing to determine the net present value to the
1.9lender of the mortgage loan if it were modified in any way so as to permit the homeowner to
1.10retain the property, as compared to the net present value to the lender of foreclosure. If there
1.11is any possible loan modification that would cause the net present value to the lender of the
1.12modified loan to exceed the net present value of foreclosure, the lender has a duty to make a
1.13good-faith offer to modify the loan. In calculating the net present value of the alternatives,
1.14the lender shall use the same discount rate in both calculations. The lender shall provide
1.15the calculations to the borrower prior to commencing foreclosure and retain its calculations
1.16and analysis of the possible modifications, and records of the lender's communications
1.17with the borrower about those calculations and analysis, for at least six years.
1.18EFFECTIVE DATE.This section is effective August 1, 2013, and applies to
1.19foreclosures commenced on or after that date.
1.3to foreclosure; proposing coding for new law in Minnesota Statutes, chapter 580.
1.4BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.5 Section 1. [580.023] CERTAIN PREFORECLOSURE CALCULATIONS
1.6REQUIRED.
1.7A mortgage lender, prior to initiating a foreclosure of a mortgage on residential
1.8property, has a duty of good faith and fair dealing to determine the net present value to the
1.9lender of the mortgage loan if it were modified in any way so as to permit the homeowner to
1.10retain the property, as compared to the net present value to the lender of foreclosure. If there
1.11is any possible loan modification that would cause the net present value to the lender of the
1.12modified loan to exceed the net present value of foreclosure, the lender has a duty to make a
1.13good-faith offer to modify the loan. In calculating the net present value of the alternatives,
1.14the lender shall use the same discount rate in both calculations. The lender shall provide
1.15the calculations to the borrower prior to commencing foreclosure and retain its calculations
1.16and analysis of the possible modifications, and records of the lender's communications
1.17with the borrower about those calculations and analysis, for at least six years.
1.18EFFECTIVE DATE.This section is effective August 1, 2013, and applies to
1.19foreclosures commenced on or after that date.
