AB 284 Restores Foreclosure Process

I have been extraordinarily honored to have participated in a working group with the Nevada Attorney General’s Office in Nevada Assembly Bill 284.  AB 284 passed the Assembly with a vote of 33-9, and passed the Senate with a vote of 20-1.   AB 284 was signed into law on May 20, 2011 with overwhelming support from Assembly Leader Marcus Conklin. The Bill takes effect October 1, 2011.

AB 284 will help the Nevada economy recover by significantly improving NRS 106, 107, and 205, with respect to foreclosures. The Bill is in response to inaccurate and fraudulently executed documents filed by lenders, trustees and servicers. AB 284 increases criminal penalties where “robo-signing” conduct occurs, and it creates a NEW private right of action for borrowers, which includes attorneys’ fees and a mandatory fine when a foreclosure has not proceeded properly. As a result, the Bill will reduce improper parties from foreclosing and creates a remedy for improper, deficient, or fraudulent documentation. Ultimately, this will aid in stabilizing real property values and restoring transparency and integrity in the foreclosure process, both of which are key to recovery. The Bill requires that the foreclosing party supplement the Notice of Default with a notarized Affidavit of Authority. The Affidavit of Authority, i) states the identity of the trustee, ii) describes the amount in default, iii) lists the full name and address of the current beneficiary (and every prior beneficiary under the deed of trust), and iv) includes the penalties and costs related to the default and foreclosure. This element of AB 284 will allow borrowers to determine the parties in the chain of beneficial interest, the amount of money they owe as result of default and foreclosure, and whether the foreclosing party has the right to foreclose.

AB 284 creates a standard of care for the trustee under a deed of trust. The trustee’s standard of care shall serve as a vast improvement from its predecessor, or lack thereof. A trustee under a deed of trust was not held to any specific standard prior to AB 284, nor was the term “trustee” defined in the foreclosure context. NRS 106 is amended to define who a trustee may be, and what their obligation is to the foreclosure parties. It also sets forth a private cause of action if trustees act improperly. Lastly, AB 284 requires all assignments of deeds of trust affecting real property be recorded in the County Recorder’s office where the property is situated.

Tisha Black Chernine, Esq.

AB284 Approved, Becomes Law

On May 20, 2011 Nevada Governor Brian Sandoval approved Assembly Bill  284 to be signed into law.    AB 284 will help restore transparency and integrity to the foreclosure process.   As previously reported, some of the changes enacted by AB284 are as follows:

  • Defines who can act as a foreclosure trustee in the state of Nevada;
  • Defines a standard of care for such trustee;
  • Requires that all assignments or trust deeds affecting real property be recorded in the County Recorder’s office where the property is situated;
  • Requires a foreclosing trustee to file an sworn Affidavit with the Notice of Default;
  • Requires the Affidavit of Authority  which details the arrearages, associated costs, and names the beneficiary (often called investor) of the deed of trust;
  • Increases criminal penalties where “robo-signing” conduct occurs ; and
  • Creates a NEW private right of action for borrowers, which includes attorneys fees and a mandatory fine when a foreclosure has not proceeded properly.

AB284 Passes Senate

On May 11, 2011 the Nevada Senate passed Assembly Bill AB 284 with 20 Yeas and 1 Nay (see voting details below).  AB 284, as we have reported:

  • Defines who can act as a foreclosure trustee in the state of Nevada;
  • Defines a standard of care for such trustee;
  • Requires that all assignments or trust deeds affecting real property be recorded in the County Recorder’s office where the property is situated;
  • Requires a foreclosing trustee to file an sworn Affidavit with the Notice of Default;
  • Requires the Affidavit of Authority  which details the arrearages, associated costs, and names the beneficiary (often called investor) of the deed of trust;
  • Increases criminal penalties where “robo-signing” conduct occurs ; and
  • Creates a NEW private right of action for borrowers, which includes attorneys fees and a mandatory fine when a foreclosure has not proceeded properly.

The only remaining condition for this bill to become a law is Governor Sandoval’s signature. Tisha Black Chernine, managing partner a of Black & LoBello, expects the Bill to be in front of the Governor within the next week. Stay tuned……..

Shirley Breeden Yea
Greg Brower Yea
Barbara Cegavske Yea
Allison Copening Yea
Mo Denis Yea
Don Gustavson Nay
Elizabeth Halseth Yea
Joe Hardy Yea
Steven Horsford Yea
Ben Kieckhefer Yea
Ruben Kihuen Yea
John Lee Yea
Sheila Leslie Yea
Mark Manendo Yea
Mike McGinness Yea
David Parks Yea
Dean Rhoads Yea
Michael Roberson Yea
Michael Schneider Yea
James Settelmeyer Yea
Valerie Wiener Yea

Tisha Black Chernine, Esq.

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