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Committee clears amendment to foreclosure timing bill to tighten documentation for successor debt holders
Summary
HB523, which clarifies the statute-of-limitations trigger and requires additional documentation when a secured party that acquired a defaulted debt commences foreclosure, moved favorably as amended. Sponsor's office said the change matches the version that previously passed the House.
The subcommittee approved an amended version of HB523, a bill that clarifies when the statute of limitations runs on mortgage-related claims and requires additional documentation when a secured party that acquired an in-default debt begins foreclosure proceedings.
Committee counsel summarized the text and the amendment, which clarifies the trigger date for the running of limitations and requires petitioners who are not the original mortgagee to attach specified chain-of-custody and calculation documents to foreclosure filings. Josh Paper, speaking for Delegate Dana Jones's office, said the amendment is a technical change (using the date of last payment as the trigger) and that the bill largely tracks the version that passed the House previously.
Members discussed "zombie mortgage" issues and whether the documentation requirement is redundant for licensed debt collectors; counsel explained the provision targets successor purchasers of old, charged-off loans and aims to make the chain of ownership and accounting transparent to homeowners facing late-filed foreclosures.
The subcommittee voted to move the bill as amended.
