Maryland 2025 Regular Session

Maryland Senate Bill SB682 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1
2	2
3	3	EXPLANATION: CAPITALS INDICATE MATTER ADDE D TO EXISTING LAW .
4	4	[Brackets] indicate matter deleted from existing law.
5	5	sb0682
6	6
7	7	SENATE BILL 682
8	8	N1 5lr2796
9	9	CF HB 769
10	10	By: Senator Charles
11	11	Introduced and read first time: January 26, 2025
12	12	Assigned to: Judicial Proceedings
13	13
14	14	A BILL ENTITLED
15	15
16	16	AN ACT concerning 1
17	17
18	18	Real Property – Residential Foreclosures – Materially Delinquent Mortgages 2
19	19
20	20	FOR the purpose of altering certain requirements for an order to docket or a complaint to 3
21	21	foreclose a mortgage or deed of trust on residential property; requiring a secured 4
22	22	party to provide certain loan–related correspondence in order to enforce a materially 5
23	23	delinquent mortgage, subject to certain exceptions; permitting a mortgagor to raise 6
24	24	a defense of laches in an action to enforce a materially delinquent mortgage; and 7
25	25	generally relating to materially delinquent mortgages and foreclosures on 8
26	26	residential property. 9
27	27
28	28	BY repealing and reenacting, without amendments, 10
29	29	Article – Real Property 11
30	30	Section 7–105.1(a)(1), (8), and (12) and (b) 12
31	31	Annotated Code of Maryland 13
32	32	(2023 Replacement Volume and 2024 Supplement) 14
33	33
34	34	BY repealing and reenacting, with amendments, 15
35	35	Article – Real Property 16
36	36	Section 7–105.1(e)(1) 17
37	37	Annotated Code of Maryland 18
38	38	(2023 Replacement Volume and 2024 Supplement) 19
39	39
40	40	BY adding to 20
41	41	Article – Real Property 21
42	42	Section 7–105.19 22
43	43	Annotated Code of Maryland 23
44	44	(2023 Replacement Volume and 2024 Supplement) 24
45	45
46	46	SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 25
47	47	That the Laws of Maryland read as follows: 26
48	48	2 SENATE BILL 682
49	49
50	50
51	51	Article – Real Property 1
52	52
53	53	7–105.1. 2
54	54
55	55	(a) (1) In this section the following words have the meanings indicated. 3
56	56
57	57	(8) “Owner–occupied residential property” means residential property in 4
58	58	which at least one unit is occupied by an individual who: 5
59	59
60	60	(i) Has an ownership interest in the property; and 6
61	61
62	62	(ii) Uses the property as the individual’s primary residence. 7
63	63
64	64	(12) “Residential property” means real property improved by four or fewer 8
65	65	single family dwelling units that are designed principally and are intended for human 9
66	66	habitation. 10
67	67
68	68	(b) (1) Except as provided in paragraph (2) of this subsection, an action to 11
69	69	foreclose a mortgage or deed of trust on residential property may not be filed until the later 12
70	70	of: 13
71	71
72	72	(i) 90 days after a default in a condition on which the mortgage or 14
73	73	deed of trust provides that a sale may be made; or 15
74	74
75	75	(ii) 45 days after the notice of intent to foreclose required under 16
76	76	subsection (c) of this section is sent. 17
77	77
78	78	(2) (i) The secured party may petition the circuit court for leave to 18
79	79	immediately commence an action to foreclose the mortgage or deed of trust if: 19
80	80
81	81	1. The loan secured by the mortgage or deed of trust was 20
82	82	obtained by fraud or deception; 21
83	83
84	84	2. No payments have ever been made on the loan secured by 22
85	85	the mortgage or deed of trust; 23
86	86
87	87	3. The property subject to the mortgage or deed of trust has 24
88	88	been destroyed; 25
89	89
90	90	4. The default occurred after the stay has been lifted in a 26
91	91	bankruptcy proceeding; or 27
92	92
93	93	5. The property subject to the mortgage or deed of trust is 28
94	94	property that is vacant and abandoned as provided under § 7–105.18 of this subtitle. 29
95	95
96	96	(ii) The court may rule on the petition with or without a hearing. 30
97	97	SENATE BILL 682 3
98	98
99	99
100	100	(iii) If the petition is granted: 1
101	101
102	102	1. The action may be filed at any time after a default in a 2
103	103	condition on which the mortgage or deed of trust provides that a sale may be made; and 3
104	104
105	105	2. The secured party need not send the written notice of 4
106	106	intent to foreclose required under subsection (c) of this section. 5
107	107
108	108	(e) An order to docket or a complaint to foreclose a mortgage or deed of trust on 6
109	109	residential property shall: 7
110	110
111	111	(1) Include: 8
112	112
113	113	(i) If applicable, the license number of: 9
114	114
115	115	1. The mortgage originator; and 10
116	116
117	117	2. The mortgage lender; and 11
118	118
119	119	(ii) An affidavit stating: 12
120	120
121	121	1. The date on which the default occurred and the nature of 13
122	122	the default; [and] 14
123	123
124	124	2. A. WHETHER THE DEBT INST RUMENT 15
125	125	CONSTITUTES A MATERI ALLY DELINQUENT MORT GAGE WITHIN THE MEAN ING OF § 16
126	126	7–105.19 OF THIS SUBTITLE; AND 17
127	127
128	128	B. IF THE DEBT INSTRUMEN T IS A MATER IALLY 18
129	129	DELINQUENT MORTGAGE WITHIN THE MEANING O F § 7–105.19 OF THIS SUBTITLE , 19
130	130	THAT THE SECURED PAR TY HAS SATISFIED ANY REQUIREMENTS FOR INS TITUTING 20
131	131	FORECLOSURE UNDER TH AT SECTION; AND 21
132	132
133	133	[2.] 3. If applicable, that: 22
134	134
135	135	A. A notice of intent to foreclose was sent to the mortgagor or 23
136	136	grantor in accordance with subsection (c) of this section and the date on which the notice 24
137	137	was sent; and 25
138	138
139	139	B. At the time the notice of intent to foreclose was sent, the 26
140	140	contents of the notice of intent to foreclose were accurate; and 27
141	141
142	142	7–105.19. 28
143	143
144	144	(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 29
145	145	INDICATED. 30 4 SENATE BILL 682
146	146
147	147
148	148
149	149	(2) “BILLING CYCLE” MEANS: 1
150	150
151	151	(I) IF A MORTGAGE REQUIRE S PERIODIC PAYMENTS AT 2
152	152	INTERVALS OF 3 MONTHS OR LESS , THE INTERVAL BETWEEN THE DAYS OR DATES OF 3
153	153	REGULAR PERIODIC PAY MENTS REQUIRED BY TH E TERMS OF THE MORTG AGE; OR 4
154	154
155	155	(II) IF THE MORTGAGE TERMS DO NOT REQUIRE PERIO DIC 5
156	156	PAYMENTS OR REQUIRE PERIODIC PAYMENTS ON INTERVALS GREATER TH AN 3 6
157	157	MONTHS, EVERY 3 MONTHS. 7
158	158
159	159	(3) “LOAN–RELATED CORRESPONDEN CE” MEANS WRITTEN 8
160	160	COMMUNICATION FROM A SECURED PARTY TO A M ORTGAGOR THAT : 9
161	161
162	162	(I) IF THE SECURED PARTY IS REQUIRED TO PROVI DE 10
163	163	PERIODIC STATEMENTS UNDER 12 C.F.R. § 1026.41, COMPLIES WITH THE 11
164	164	REQUIREMENTS OF THAT PROVISION; OR 12
165	165
166	166	(II) IF THE SECURED PARTY IS NOT REQUIRED TO PROVIDE 13
167	167	PERIODIC STATEMENTS UNDER 12 C.F.R. § 1026.41, CONTAINS THE FOLLOWI NG: 14
168	168
169	169	1. THE NAME AND CONTACT INFORMATION OF THE 15
170	170	SECURED PARTY ; 16
171	171
172	172	2. THE CURRENT AMOUNT OF THE OUTSTANDING 17
173	173	PRINCIPAL BALANCE ; 18
174	174
175	175	3. THE CURRENT INTEREST RATE IN EFFECT; 19
176	176
177	177	4. THE AMOUNT CURRENTLY DUE DISAGGREGATED BY 20
178	178	PRINCIPAL, INTEREST, CHARGES, AND FEES; AND 21
179	179
180	180	5. THE LENGTH OF ANY PAY MENT DELINQUENCY , 22
181	181	INCLUDING THE DATE O F LAST PAYMENT . 23
182	182
183	183	(4) “MATERIALLY DELINQUENT MORTGAGE ” MEANS A MORTGAGE ON 24
184	184	WHICH NO PA YMENTS HAVE BEEN MAD E BY A PARTY, OTHER THAN THE SECUR ED 25
185	185	PARTY, IN THE PRECEDING 5 YEARS, EXCLUDING ANY PERIOD OF TIME IN WHICH A 26
186	186	SECURED PARTY COULD NOT INSTITUTE A FORE CLOSURE PROCEEDING D UE TO AN 27
187	187	EXECUTIVE ORDER OR O THER SIMILAR OFFICIA L ACTION RESTRICT ING 28
188	188	FORECLOSURE ACTIONS . 29
189	189
190	190	(5) “MORTGAGE” MEANS ANY MORTGAGE O R DEED OF TRUST 30
191	191	ENCUMBERING OWNER –OCCUPIED RESIDENTIAL PROPERTY. 31 SENATE BILL 682 5
192	192
193	193
194	194
195	195	(6) “MORTGAGOR” MEANS ANY PARTY SIGN ING A MORTGAGE AS A 1
196	196	MORTGAGOR OR A DEED OF TRUST AS A GRANTO R. 2
197	197
198	198	(7) “OWNER–OCCUPIED RES IDENTIAL PROPERTY ” HAS THE MEANING 3
199	199	STATED IN § 7–105.1 OF THIS SUBTITLE. 4
200	200
201	201	(8) “RESIDENTIAL PROPERTY ” HAS THE MEANING STAT ED IN § 5
202	202	7–105.1 OF THIS SUBTITLE . 6
203	203
204	204	(9) “SECURED PARTY ” MEANS AN OWNER , A SERVICER, OR ANY 7
205	205	OTHER PERSON ENTITLE D TO ENFORCE A MORTG AGE OR A DEED OF TRU ST. 8
206	206
207	207	(B) (1) THIS SUBSECTION MAY N OT BE INTERPRETED TO : 9
208	208
209	209	(I) PROHIBIT THE FILING O F A PETITION UNDER § 10
210	210	7–105.1(B)(2) OF THIS SUBTITLE; OR 11
211	211
212	212	(II) PRECLUDE THE COURT FR OM GRANTING A PETITI ON WITH 12
213	213	RESPECT TO A MATERIA LLY DELINQUENT MORTGAGE UNDER § 7–105.1(B)(2) OF 13
214	214	THIS SUBTITLE. 14
215	215
216	216	(2) UNLESS PROHIBITED BY LAW, REGULATION , OR EXECUTIVE 15
217	217	ORDER, A SECURED PARTY SHAL L SEND LOAN–RELATED CORRESPONDEN CE TO THE 16
218	218	MORTGAGOR OF A MATER IALLY DELINQUENT MOR TGAGE IN EACH BILLIN G CYCLE. 17
219	219
220	220	(3) PRIOR TO OCTOBER 1, 2027, A SECURED PARTY MAY ENFORCE A 18
221	221	MATERIALLY DELINQUEN T MORTGAGE THROUGH C OMMENCEMENT OF A 19
222	222	FORECLOSURE OR JUDIC IAL SALE ONLY IF: 20
223	223
224	224	(I) AT LEAST ONE PIECE OF LOAN–RELATED 21
225	225	CORRESPONDENCE WAS S ENT TO THE MORTGAGOR DURING EACH BILLING CYCLE 22
226	226	FOR THE IMMEDIATELY PRECEDING 24 MONTHS, EXCLUDING ANY PERIOD DURING 23
227	227	WHICH THE SECURED PA RTY WAS PROHIBITED B Y LAW, REGULATION , OR 24
228	228	EXECUTIVE ORDER FROM SENDING LOAN –RELATED CORRESPONDEN CE TO THE 25
229	229	MORTGAGOR ; OR 26
230	230
231	231	(II) ON A FORM PROVIDED BY THE COMMISSION ER OF 27
232	232	FINANCIAL REGULATION, THE SECURED PARTY SER VES NOTICE ON THE 28
233	233	MORTGAGOR OF THE MAT ERIALLY DELINQUENT M ORTGAGE AT LEAST 90 DAYS 29
234	234	PRIOR TO COMMENCEMEN T. 30
235	235
236	236	(4) ON OR AFTER OCTOBER 1, 2027, A SECURED PARTY MAY ENFORCE 31
237	237	A MATERIALLY DELINQU ENT MORTGAGE THRO UGH A FORECLOSURE OR JUDICIAL 32 6 SENATE BILL 682
238	238
239	239
240	240	SALE ONLY IF THE SEC URED PARTY HAS MET T HE REQUIREMENTS OF P ARAGRAPH 1
241	241	(2) OF THIS SUBSECTION F OR THE IMMEDIATELY P RECEDING 24 CONSECUTIVE 2
242	242	MONTHS. 3
243	243
244	244	(5) THE COMMISSIONER OF FINANCIAL REGULATION MAY DEVELO P 4
245	245	THE FORM REQUIRED UN DER PARAGRAPH (3)(II) OF THIS SUBSECTION B Y 5
246	246	REGULATION . 6
247	247
248	248	(C) (1) IN AN ACTION TO FOREC LOSE OR OTHERWISE EN FORCE A 7
249	249	MATERIALLY DELINQUEN T MORTGAGE , A MORTGAGOR MAY RAIS E A DEFENSE OF 8
250	250	LACHES. 9
251	251
252	252	(2) A COURT CONSIDERING A DEFENSE OF LACHES IN AN ACTION TO 10
253	253	FORECLOSE OR OTHERWISE E NFORCE A MATERIALLY DELINQUENT MORTGAGE 11
254	254	MAY: 12
255	255
256	256	(I) ATTRIBUTE ANY DELAY I N THE ENFORCEMENT OF THE 13
257	257	MORTGAGE TO THE SECU RED PARTY EVEN IF TH E SECURED PARTY DID NOT HOLD 14
258	258	AN INTEREST IN THE M ORTGAGE AT ALL TIMES DURING THE DELAY IN 15
259	259	ENFORCEMENT; AND 16
260	260
261	261	(II) ORDER ANY RELIEF THE COURT CONSIDERS TO B E 17
262	262	APPROPRIATE . 18
263	263
264	264	SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 19
265	265	January 1, 2026. 20
266	266