Oregon Governor Kate Brown recently enacted the law 2009 bill, which, among other things, relieves borrowers who have been financially affected by the COVID-19 pandemic by spelling out certain prohibited activities that apply to finance agreement lenders during the emergency period. The bill entered into force on June 1, 2021, and the provisions of the COVID-19 bill will be repealed 90 days after the expiration of the emergency period.
The bill generally defines the “emergency period” as a period from December 31, 2020 to June 30, 2021, except that by decree, the governor may: (i) no later than June 14, 2021, extend the period of emergency as of September 30, 2021; and (ii) no later than August 16, 2021, extend the emergency period until December 31, 2021. Note before the deadline of June 14, 2021, the Governor expanded the emergency period until September 30, 2021.
During the emergency period, if certain conditions are met, the bill generally prohibits lenders from treating as default the failure of a borrower to make a periodic payment or the failure to pay any other amount owed to the lender on or in connection with an obligation which is the subject of a “financing agreement”, that is, a contract under which a borrower must make payments to a lender to satisfy an obligation secured by a mortgage , a trust deed or contract for the sale of real estate on which four or fewer residential units are used primarily and are designed solely for residential use.
Although the bill allows a lender and a borrower to modify, postpone or otherwise mitigate (e.g. treat a borrower’s default as a default, defer collection of payment for the emergency period and allow the borrower to pay the amount due on or before the expiration of the emergency period or the scheduled or anticipated date on which full performance of the obligation is due.
Lenders are also prohibited during the emergency period: (i) to impose or collect charges, fees, penalties, attorneys’ fees or other amounts for the borrower’s default in payment, (ii) d ” impose a default rate of interest for the borrower’s failure to make a payment, (iii) treat in any way the borrower’s failure to make a payment during the emergency period as a ineligibility for a foreclosure avoidance measure, or (iv) require or charge for an inspection, appraisal or valuation notice from a broker. In addition, with respect to the property of the borrower, subject to certain exceptions, a lender or trustee may not at any time during the emergency period prohibit a trust deed by publicity and sale, institute an action or sue for foreclosure of a mortgage or trust deed, or exercise recourse in the event of forfeiture.
Please note that the above prohibitions are conditional on the borrower, during the emergency period, notifying the lender, in writing or orally, that the borrower cannot make the payment due to loss of income. linked to the COVID-19 pandemic. The notice required by the borrower need not be given more than once, provided that the notice is given on or after the effective date of the invoice.
The bill also requires lenders to notify their borrowers who cannot make a payment due to loss of income from the COVID-19 pandemic that they may be eligible for relief, provided borrowers notify the lender of their difficulties. Please note that a lender may comply with the invoice notice requirements by mailing the specified notice to: (i) all of its borrowers within 60 days of the effective date of the invoice, or (ii ) every borrower who fails to make a payment within 30 days of the borrower fails to make a payment.
Finally, the bill also amends the foreclosure provisions of trust deeds to allow a resolution conference to be held via remote audio or video communication.