§ 5-80-8 Prohibited practices. – A foreclosure purchaser shall not:
(1) Enter into, or attempt to enter into, a foreclosurereconveyance with a foreclosed homeowner unless:
(i) The foreclosure purchaser verifies and can demonstratethat the foreclosed homeowner has a reasonable ability to pay for thesubsequent conveyance of an interest back to the foreclosed homeowner. In thecase of a lease with an option to purchase, payment ability also included thereasonable ability to make the lease payments and purchase the property withinthe term of the option to purchase. There is a rebuttable presumption that ahomeowner is reasonably able to pay for the subsequent conveyance if theowner's payments for primary housing expenses and regular principal andinterest payments on other personal debt, on a monthly basis, do not exceedsixty percent (60%) of the owner's monthly gross income. For the purposes ofthis section, "primary housing expenses" means the sum of payments for regularprincipal, interest, rent, utilities, hazard insurance, real estate taxes, andassociation dues. There is a rebuttable presumption that the foreclosurepurchaser has not verified reasonable payment ability if the foreclosurepurchaser has not obtained documents other than a statement by the foreclosedhomeowner of assets, liabilities, and income;
(ii) The foreclosure purchaser and the foreclosed homeownercomplete a closing for any foreclosure reconveyance in which the foreclosurepurchaser obtains a deed or mortgage from a foreclosed homeowner. For purposesof this section, "closing" means an in-person meeting to complete finaldocuments incident to the sale of the real property or creation of a mortgageon the real property conducted by a closing agent who is not employed by or anaffiliate of the foreclosure purchaser;
(iii) The foreclosure purchaser obtains the written consentof the foreclosed homeowner to a grant by the foreclosure purchaser of anyinterest in the property during such times as the foreclosed homeownermaintains any interest in the property; and
(iv) The foreclosure purchaser complies with the requirementsof the federal home Ownership Equity Protection Act, United States Code, title15, § 1639, or its implementing regulation, Code of Federal Regulations,title 12, §§ 226.31 – 226.34, for any foreclosure reconveyancein which the foreclosed homeowner obtains a vendee interest in a contract fordeed;
(2) Fail to either;
(i) Ensure that title to the subject dwelling has beenreconveyed to the foreclosed homeowner; or
(ii) Make a payment to the foreclosed homeowner such that theforeclosed homeowner has received consideration in an amount of at least eightytwo percent (82%) of the fair market value of the property within one hundredfifty (150) days of either the eviction or voluntary relinquishment ofpossession of the dwelling by the foreclosed homeowner. The foreclosurepurchaser shall make a detailed accounting of the basis for the payment amount,or a detailed accounting of the reasons for failure to make a payment,including providing written documentation of expenses, within this one hundredfifty (150) day period. The accounting shall be on a form prescribed by thedepartment of attorney general, in consultation with the department of businessregulation, without being subject to the rulemaking procedures of chapter42-35. For purposes of this provision, the following applies:
(A) There is a rebuttable presumption that an appraisal by aperson licensed or certified by an agency of the federal government or thisstate to appraise real estate constitutes the fair market value of the property;
(B) The time for determining the fair market value amountshall be determined in the foreclosure reconveyance contract as either at thetime of the execution of the foreclosure reconveyance contract or at resale. Ifthe contract states that the fair market value shall be determined at the timeof resale, the fair market value shall be the resale price if it is sold withinone hundred twenty (120) days of the eviction or voluntary relinquishment ofthe property by the foreclosed homeowner. If the contract states that the fairmarket value shall be determined at the time of resale, and the resale is notcompleted within one hundred twenty (120) days of the eviction or voluntaryrelinquishment of the property by the foreclosed homeowner, the fair marketvalue shall be determined by an appraisal conducted during this one hundredtwenty (120) day period and payment, if required, shall be made to thehomeowner, but the fair market value shall be recalculated as the resale price,on resale and an additional payment amount, if appropriate based on the resaleprice, shall be made to the foreclosed homeowner within fifteen (15) days ofresale, and a detailed accounting of the basis for the payment amount, or adetailed accounting of the reasons for failure to make additional payment,shall be made within fifteen (15) days of resale, including providing writtendocumentation of expenses. The accounting shall be on a form prescribed by thedepartment of attorney general, in consultation with the department of businessregulation, without being subject to the rulemaking procedures of chapter 42-35;
(C) "Consideration" shall mean any payment or item of valueprovided to the foreclosed homeowner, including unpaid rent or contract fordeed payments owed by the foreclosed homeowner prior to the date of eviction orvoluntary relinquishment of the property, reasonable costs paid to thirdparties necessary to complete the foreclosure reconveyance transaction, paymentof money to satisfy a debt or legal obligation of the foreclosed homeowner, orthe reasonable cost of repairs for damage to the dwelling caused by theforeclosed homeowner;
(D) "Consideration" shall not include amounts imputed as adown payment or fee to the foreclosure purchaser, or a person acting inparticipation with the foreclosure purchaser, incident to a contract for deed,lease, or option to purchase entered into as part of the foreclosurereconveyance, except for reasonable costs paid to third parties necessary tocomplete the foreclosure reconveyance;
(3) Enter into repurchase or lease terms as part of thesubsequent conveyance that are unfair or commercially unreasonable, or engagein any other unfair conduct;
(4) Represent, directly or indirectly, that:
(i) The foreclosure purchaser is acting as an advisor or aconsultant, or in any other manner represents that the foreclosure purchaser isacting on behalf of the homeowner;
(ii) The foreclosure purchaser has certification or licensurethat the foreclosure purchaser does not have, or that the foreclosure purchaseris not a member of a licensed profession if that is untrue;
(iii) The foreclosure purchaser is assisting the foreclosedhomeowner to "save the house" or substantially similar phrase; or
(iv) The foreclosure purchaser is assisting the foreclosedhomeowner in preventing a completed foreclosure if the result of thetransaction is that the foreclosed homeowner will not complete a redemption ofthe property;
(5) Make any other statements, directly or by implication, orengage in any other conduct that is false, deceptive, or misleading, or thathas the likelihood to cause confusion or misunderstanding, including, but notlimited to, statements regarding the value of the residence in foreclosure, theamount of proceeds the foreclosed homeowner will receive after a foreclosuresale, any contract term, or the foreclosed homeowner's rights or obligationsincident to or arising out of the foreclosure reconveyance; or
(6) Do any of the following until the time during which theforeclosed homeowner may cancel the transaction has fully elapsed:
(i) Accept from any foreclosed homeowner an execution of, orinduce any foreclosed homeowner to execute, any instrument of conveyance of anyinterest in the residence in foreclosure;
(ii) Record with the records of land evidence in the city ortown where such foreclosed property is located any document, including, but notlimited to, any instrument of conveyance, signed by the foreclosed homeowner;
(iii) Transfer or encumber or purport to transfer or encumberany interest in the residence in foreclosure to any third-party, provided nogrant of any interest or encumbrance is defeated or affected as against a bonafide purchaser or encumbrance for value and without notice of a violation of§§ 5-80-1 – 5-80-9, and knowledge on the part of any such personor entity that the property was "residential real property in foreclosure" doesnot constitute notice of a violation of §§ 5-80-1 – 5-80-9. Thissection does not abrogate any duty of inquiry which exists as to rights orinterest of persons in possession of the residential real property inforeclosure; or
(iv) Pay the foreclosed homeowner any consideration.
§ 5-80-8 Prohibited practices. – A foreclosure purchaser shall not:
(1) Enter into, or attempt to enter into, a foreclosurereconveyance with a foreclosed homeowner unless:
(i) The foreclosure purchaser verifies and can demonstratethat the foreclosed homeowner has a reasonable ability to pay for thesubsequent conveyance of an interest back to the foreclosed homeowner. In thecase of a lease with an option to purchase, payment ability also included thereasonable ability to make the lease payments and purchase the property withinthe term of the option to purchase. There is a rebuttable presumption that ahomeowner is reasonably able to pay for the subsequent conveyance if theowner's payments for primary housing expenses and regular principal andinterest payments on other personal debt, on a monthly basis, do not exceedsixty percent (60%) of the owner's monthly gross income. For the purposes ofthis section, "primary housing expenses" means the sum of payments for regularprincipal, interest, rent, utilities, hazard insurance, real estate taxes, andassociation dues. There is a rebuttable presumption that the foreclosurepurchaser has not verified reasonable payment ability if the foreclosurepurchaser has not obtained documents other than a statement by the foreclosedhomeowner of assets, liabilities, and income;
(ii) The foreclosure purchaser and the foreclosed homeownercomplete a closing for any foreclosure reconveyance in which the foreclosurepurchaser obtains a deed or mortgage from a foreclosed homeowner. For purposesof this section, "closing" means an in-person meeting to complete finaldocuments incident to the sale of the real property or creation of a mortgageon the real property conducted by a closing agent who is not employed by or anaffiliate of the foreclosure purchaser;
(iii) The foreclosure purchaser obtains the written consentof the foreclosed homeowner to a grant by the foreclosure purchaser of anyinterest in the property during such times as the foreclosed homeownermaintains any interest in the property; and
(iv) The foreclosure purchaser complies with the requirementsof the federal home Ownership Equity Protection Act, United States Code, title15, § 1639, or its implementing regulation, Code of Federal Regulations,title 12, §§ 226.31 – 226.34, for any foreclosure reconveyancein which the foreclosed homeowner obtains a vendee interest in a contract fordeed;
(2) Fail to either;
(i) Ensure that title to the subject dwelling has beenreconveyed to the foreclosed homeowner; or
(ii) Make a payment to the foreclosed homeowner such that theforeclosed homeowner has received consideration in an amount of at least eightytwo percent (82%) of the fair market value of the property within one hundredfifty (150) days of either the eviction or voluntary relinquishment ofpossession of the dwelling by the foreclosed homeowner. The foreclosurepurchaser shall make a detailed accounting of the basis for the payment amount,or a detailed accounting of the reasons for failure to make a payment,including providing written documentation of expenses, within this one hundredfifty (150) day period. The accounting shall be on a form prescribed by thedepartment of attorney general, in consultation with the department of businessregulation, without being subject to the rulemaking procedures of chapter42-35. For purposes of this provision, the following applies:
(A) There is a rebuttable presumption that an appraisal by aperson licensed or certified by an agency of the federal government or thisstate to appraise real estate constitutes the fair market value of the property;
(B) The time for determining the fair market value amountshall be determined in the foreclosure reconveyance contract as either at thetime of the execution of the foreclosure reconveyance contract or at resale. Ifthe contract states that the fair market value shall be determined at the timeof resale, the fair market value shall be the resale price if it is sold withinone hundred twenty (120) days of the eviction or voluntary relinquishment ofthe property by the foreclosed homeowner. If the contract states that the fairmarket value shall be determined at the time of resale, and the resale is notcompleted within one hundred twenty (120) days of the eviction or voluntaryrelinquishment of the property by the foreclosed homeowner, the fair marketvalue shall be determined by an appraisal conducted during this one hundredtwenty (120) day period and payment, if required, shall be made to thehomeowner, but the fair market value shall be recalculated as the resale price,on resale and an additional payment amount, if appropriate based on the resaleprice, shall be made to the foreclosed homeowner within fifteen (15) days ofresale, and a detailed accounting of the basis for the payment amount, or adetailed accounting of the reasons for failure to make additional payment,shall be made within fifteen (15) days of resale, including providing writtendocumentation of expenses. The accounting shall be on a form prescribed by thedepartment of attorney general, in consultation with the department of businessregulation, without being subject to the rulemaking procedures of chapter 42-35;
(C) "Consideration" shall mean any payment or item of valueprovided to the foreclosed homeowner, including unpaid rent or contract fordeed payments owed by the foreclosed homeowner prior to the date of eviction orvoluntary relinquishment of the property, reasonable costs paid to thirdparties necessary to complete the foreclosure reconveyance transaction, paymentof money to satisfy a debt or legal obligation of the foreclosed homeowner, orthe reasonable cost of repairs for damage to the dwelling caused by theforeclosed homeowner;
(D) "Consideration" shall not include amounts imputed as adown payment or fee to the foreclosure purchaser, or a person acting inparticipation with the foreclosure purchaser, incident to a contract for deed,lease, or option to purchase entered into as part of the foreclosurereconveyance, except for reasonable costs paid to third parties necessary tocomplete the foreclosure reconveyance;
(3) Enter into repurchase or lease terms as part of thesubsequent conveyance that are unfair or commercially unreasonable, or engagein any other unfair conduct;
(4) Represent, directly or indirectly, that:
(i) The foreclosure purchaser is acting as an advisor or aconsultant, or in any other manner represents that the foreclosure purchaser isacting on behalf of the homeowner;
(ii) The foreclosure purchaser has certification or licensurethat the foreclosure purchaser does not have, or that the foreclosure purchaseris not a member of a licensed profession if that is untrue;
(iii) The foreclosure purchaser is assisting the foreclosedhomeowner to "save the house" or substantially similar phrase; or
(iv) The foreclosure purchaser is assisting the foreclosedhomeowner in preventing a completed foreclosure if the result of thetransaction is that the foreclosed homeowner will not complete a redemption ofthe property;
(5) Make any other statements, directly or by implication, orengage in any other conduct that is false, deceptive, or misleading, or thathas the likelihood to cause confusion or misunderstanding, including, but notlimited to, statements regarding the value of the residence in foreclosure, theamount of proceeds the foreclosed homeowner will receive after a foreclosuresale, any contract term, or the foreclosed homeowner's rights or obligationsincident to or arising out of the foreclosure reconveyance; or
(6) Do any of the following until the time during which theforeclosed homeowner may cancel the transaction has fully elapsed:
(i) Accept from any foreclosed homeowner an execution of, orinduce any foreclosed homeowner to execute, any instrument of conveyance of anyinterest in the residence in foreclosure;
(ii) Record with the records of land evidence in the city ortown where such foreclosed property is located any document, including, but notlimited to, any instrument of conveyance, signed by the foreclosed homeowner;
(iii) Transfer or encumber or purport to transfer or encumberany interest in the residence in foreclosure to any third-party, provided nogrant of any interest or encumbrance is defeated or affected as against a bonafide purchaser or encumbrance for value and without notice of a violation of§§ 5-80-1 – 5-80-9, and knowledge on the part of any such personor entity that the property was "residential real property in foreclosure" doesnot constitute notice of a violation of §§ 5-80-1 – 5-80-9. Thissection does not abrogate any duty of inquiry which exists as to rights orinterest of persons in possession of the residential real property inforeclosure; or
(iv) Pay the foreclosed homeowner any consideration.
§ 5-80-8 Prohibited practices. – A foreclosure purchaser shall not:
(1) Enter into, or attempt to enter into, a foreclosurereconveyance with a foreclosed homeowner unless:
(i) The foreclosure purchaser verifies and can demonstratethat the foreclosed homeowner has a reasonable ability to pay for thesubsequent conveyance of an interest back to the foreclosed homeowner. In thecase of a lease with an option to purchase, payment ability also included thereasonable ability to make the lease payments and purchase the property withinthe term of the option to purchase. There is a rebuttable presumption that ahomeowner is reasonably able to pay for the subsequent conveyance if theowner's payments for primary housing expenses and regular principal andinterest payments on other personal debt, on a monthly basis, do not exceedsixty percent (60%) of the owner's monthly gross income. For the purposes ofthis section, "primary housing expenses" means the sum of payments for regularprincipal, interest, rent, utilities, hazard insurance, real estate taxes, andassociation dues. There is a rebuttable presumption that the foreclosurepurchaser has not verified reasonable payment ability if the foreclosurepurchaser has not obtained documents other than a statement by the foreclosedhomeowner of assets, liabilities, and income;
(ii) The foreclosure purchaser and the foreclosed homeownercomplete a closing for any foreclosure reconveyance in which the foreclosurepurchaser obtains a deed or mortgage from a foreclosed homeowner. For purposesof this section, "closing" means an in-person meeting to complete finaldocuments incident to the sale of the real property or creation of a mortgageon the real property conducted by a closing agent who is not employed by or anaffiliate of the foreclosure purchaser;
(iii) The foreclosure purchaser obtains the written consentof the foreclosed homeowner to a grant by the foreclosure purchaser of anyinterest in the property during such times as the foreclosed homeownermaintains any interest in the property; and
(iv) The foreclosure purchaser complies with the requirementsof the federal home Ownership Equity Protection Act, United States Code, title15, § 1639, or its implementing regulation, Code of Federal Regulations,title 12, §§ 226.31 – 226.34, for any foreclosure reconveyancein which the foreclosed homeowner obtains a vendee interest in a contract fordeed;
(2) Fail to either;
(i) Ensure that title to the subject dwelling has beenreconveyed to the foreclosed homeowner; or
(ii) Make a payment to the foreclosed homeowner such that theforeclosed homeowner has received consideration in an amount of at least eightytwo percent (82%) of the fair market value of the property within one hundredfifty (150) days of either the eviction or voluntary relinquishment ofpossession of the dwelling by the foreclosed homeowner. The foreclosurepurchaser shall make a detailed accounting of the basis for the payment amount,or a detailed accounting of the reasons for failure to make a payment,including providing written documentation of expenses, within this one hundredfifty (150) day period. The accounting shall be on a form prescribed by thedepartment of attorney general, in consultation with the department of businessregulation, without being subject to the rulemaking procedures of chapter42-35. For purposes of this provision, the following applies:
(A) There is a rebuttable presumption that an appraisal by aperson licensed or certified by an agency of the federal government or thisstate to appraise real estate constitutes the fair market value of the property;
(B) The time for determining the fair market value amountshall be determined in the foreclosure reconveyance contract as either at thetime of the execution of the foreclosure reconveyance contract or at resale. Ifthe contract states that the fair market value shall be determined at the timeof resale, the fair market value shall be the resale price if it is sold withinone hundred twenty (120) days of the eviction or voluntary relinquishment ofthe property by the foreclosed homeowner. If the contract states that the fairmarket value shall be determined at the time of resale, and the resale is notcompleted within one hundred twenty (120) days of the eviction or voluntaryrelinquishment of the property by the foreclosed homeowner, the fair marketvalue shall be determined by an appraisal conducted during this one hundredtwenty (120) day period and payment, if required, shall be made to thehomeowner, but the fair market value shall be recalculated as the resale price,on resale and an additional payment amount, if appropriate based on the resaleprice, shall be made to the foreclosed homeowner within fifteen (15) days ofresale, and a detailed accounting of the basis for the payment amount, or adetailed accounting of the reasons for failure to make additional payment,shall be made within fifteen (15) days of resale, including providing writtendocumentation of expenses. The accounting shall be on a form prescribed by thedepartment of attorney general, in consultation with the department of businessregulation, without being subject to the rulemaking procedures of chapter 42-35;
(C) "Consideration" shall mean any payment or item of valueprovided to the foreclosed homeowner, including unpaid rent or contract fordeed payments owed by the foreclosed homeowner prior to the date of eviction orvoluntary relinquishment of the property, reasonable costs paid to thirdparties necessary to complete the foreclosure reconveyance transaction, paymentof money to satisfy a debt or legal obligation of the foreclosed homeowner, orthe reasonable cost of repairs for damage to the dwelling caused by theforeclosed homeowner;
(D) "Consideration" shall not include amounts imputed as adown payment or fee to the foreclosure purchaser, or a person acting inparticipation with the foreclosure purchaser, incident to a contract for deed,lease, or option to purchase entered into as part of the foreclosurereconveyance, except for reasonable costs paid to third parties necessary tocomplete the foreclosure reconveyance;
(3) Enter into repurchase or lease terms as part of thesubsequent conveyance that are unfair or commercially unreasonable, or engagein any other unfair conduct;
(4) Represent, directly or indirectly, that:
(i) The foreclosure purchaser is acting as an advisor or aconsultant, or in any other manner represents that the foreclosure purchaser isacting on behalf of the homeowner;
(ii) The foreclosure purchaser has certification or licensurethat the foreclosure purchaser does not have, or that the foreclosure purchaseris not a member of a licensed profession if that is untrue;
(iii) The foreclosure purchaser is assisting the foreclosedhomeowner to "save the house" or substantially similar phrase; or
(iv) The foreclosure purchaser is assisting the foreclosedhomeowner in preventing a completed foreclosure if the result of thetransaction is that the foreclosed homeowner will not complete a redemption ofthe property;
(5) Make any other statements, directly or by implication, orengage in any other conduct that is false, deceptive, or misleading, or thathas the likelihood to cause confusion or misunderstanding, including, but notlimited to, statements regarding the value of the residence in foreclosure, theamount of proceeds the foreclosed homeowner will receive after a foreclosuresale, any contract term, or the foreclosed homeowner's rights or obligationsincident to or arising out of the foreclosure reconveyance; or
(6) Do any of the following until the time during which theforeclosed homeowner may cancel the transaction has fully elapsed:
(i) Accept from any foreclosed homeowner an execution of, orinduce any foreclosed homeowner to execute, any instrument of conveyance of anyinterest in the residence in foreclosure;
(ii) Record with the records of land evidence in the city ortown where such foreclosed property is located any document, including, but notlimited to, any instrument of conveyance, signed by the foreclosed homeowner;
(iii) Transfer or encumber or purport to transfer or encumberany interest in the residence in foreclosure to any third-party, provided nogrant of any interest or encumbrance is defeated or affected as against a bonafide purchaser or encumbrance for value and without notice of a violation of§§ 5-80-1 – 5-80-9, and knowledge on the part of any such personor entity that the property was "residential real property in foreclosure" doesnot constitute notice of a violation of §§ 5-80-1 – 5-80-9. Thissection does not abrogate any duty of inquiry which exists as to rights orinterest of persons in possession of the residential real property inforeclosure; or
(iv) Pay the foreclosed homeowner any consideration.
