Connecticut Seal

General Assembly

 

Substitute Bill No. 225

    February Session, 2010

 

*_____SB00225BA____042110____*

AN ACT CONCERNING THE DUTIES OF A MORTGAGEE IN A FORECLOSURE ACTION ON RESIDENTIAL REAL PROPERTY.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. (NEW) (Effective July 1, 2010) (a) As used in this section:

(1) "Mortgagee" means the original lender or servicer under a mortgage, or its successors or assigns, who is the holder of any mortgage on residential real property securing a loan made primarily for personal, family or household purposes that is the subject of a foreclosure action.

(2) "Mortgagor" means the owner-occupant of one-to-four family residential real property located in this state who is also the borrower under a mortgage encumbering such residential real property, which is the primary residence of such owner-occupant; and

(3) "Residential real property" means a one-to-four family dwelling occupied as a residence by a mortgagor.

(b) When a mortgagee commences an action for the foreclosure of a mortgage on residential real property with a return date on or after July 1, 2010, the mortgagee shall give notice to the mortgagor, in such form as the Chief Court Administrator prescribes, of the name, business mailing address, electronic mail address and telephone number of an individual who has authority, on behalf of the mortgagee, to (1) renew, refinance or restructure the mortgage agreement in connection with a workout situation, (2) agree to a mortgage forbearance agreement, or (3) agree to any other material modification of the terms of the mortgage agreement. The notice shall indicate the name of the individual and such individual's business mailing address, electronic mail address and telephone number in boldface type at least fourteen points in size.

(c) Notwithstanding any provision of the general statutes or any rule of law to the contrary, a court may delay the entry of a judgment of strict foreclosure or foreclosure by sale, or determine that no judgment of strict foreclosure or judgment of foreclosure by sale shall be entered when, in the court's judgment, fairness and equity require such delay or determination, if the court finds that the mortgagee in an action instituted by the mortgagee to foreclose a mortgage on residential real property (1) failed to provide notice in accordance with subsection (b) of this section, (2) failed to respond within a reasonable amount of time to a request from the mortgagor to renew, refinance or restructure the mortgage agreement in connection with a workout situation, (3) failed to agree in good faith to a reasonable mortgage forbearance agreement or any other reasonable material modification of the terms of the mortgage agreement, or (4) engaged in conduct that was immoral, unethical, oppressive or unscrupulous with respect to the mortgage agreement or mortgagee.

(d) Notwithstanding any provision of the general statutes or any rule of law to the contrary, a court may delay the entry of a deficiency judgment on behalf of the mortgagee or determine that no deficiency judgment shall be entered on behalf of the mortgagee when, in the court's judgment, fairness and equity require such delay or determination, if the court finds that the mortgagee in an action instituted by the mortgagee to foreclose a mortgage on residential real property (1) failed to provide notice in accordance with subsection (b) of this section, (2) failed to respond within a reasonable amount of time to a request from the mortgagor to renew, refinance or restructure the mortgage agreement in connection with a workout situation, (3) failed to agree in good faith to a reasonable mortgage forbearance agreement or any other reasonable material modification of the terms of the mortgage agreement, or (4) engaged in conduct that was immoral, unethical, oppressive or unscrupulous with respect to the mortgage agreement or mortgagee.

Sec. 2. Section 49-14 of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2010):

(a) At any time within thirty days after the time limited for redemption has expired, any party to a mortgage foreclosure may file a motion seeking a deficiency judgment. Such motion shall be placed on the short calendar for an evidentiary hearing. Such hearing shall be held not less than fifteen days following the filing of the motion, except as the court may otherwise order. At such hearing the court shall hear the evidence, establish a valuation for the mortgaged property and shall render judgment for the plaintiff for the difference, if any, between such valuation and the plaintiff's claim, except as provided in subsection (d) of section 1 of this act. The plaintiff in any further action upon the debt, note or obligation, shall recover only the amount of such judgment.

(b) Upon the motion of any party and for good cause shown, the court may refer such motion to a state referee, who shall have and exercise the powers of the court with respect to trial, judgment and appeal in such case.

(c) Any party to a mortgage foreclosure who has moved for an appraisal of property for the purpose of obtaining a deficiency judgment, but has not been granted a deficiency judgment, or has not received full satisfaction of any deficiency judgment obtained subsequent to the filing of such motion, may make a motion to the court for a deficiency judgment as set forth in subsection (a) of this section. If such motion is made on or before November 1, 1979, such moving party shall be deemed to have complied with all of the requirements of subsection (a) of this section and shall be entitled to the benefit of any deficiency judgment rendered pursuant to said subsection (a).

(d) Any appeal pending in the Supreme Court with regard to any deficiency judgment or proceedings relating thereto shall be stayed until a hearing is held pursuant to subsection (a) of this section. Any appellant in such an appeal shall have the right for a period of thirty days after the rendering of judgment pursuant to subsection (a) of this section to amend his appeal. There shall be no stay of such an appeal if no motion has been filed pursuant to this section on or before November 1, 1979.

This act shall take effect as follows and shall amend the following sections:

Section 1

July 1, 2010

New section

Sec. 2

July 1, 2010

49-14

JUD

Joint Favorable Subst.-LCO

 

BA

Joint Favorable