Residential Foreclosures

Residential Foreclosures

The Rhode Island Statute and Its Relationship to the City Ordinance

RI's foreclosure law, General Law 34-27, has been amended to include Section 34-27-3.2, which requires a mediation conference for homeowner-occupied residences prior to foreclosure. A comprehensive review of this law is available through Partridge, Snow and Hahn LLP and can be found [HERE].

The state law is effective for foreclosures initiated on or after September 13, 2013. Foreclosures initiated prior to that date will fall under the City ordinance.

Information on compliance with the City ordinance can be found [HERE].

Information on compliance with the State law can be found [HERE] .

While the state law is very similar in its requirements to the City Ordinance Section 13-213, enacted in 2009 (amended 2010), important distinctions exist. Most importantly:

• The ordinance requires a Notice of Intent to foreclose to be filed with the City and delivered to the homeowner at anytime the foreclosure action commences. The law requires notice to the homeowner at 120 days of delinquency. In both cases the notice is intended to inform the homeowner of their right to foreclosure mediation (i.e. a debt workout.)

• Failure to abide by the ordinance would incur a $2,000 fine but allow recording of the foreclosure deed. Failure to abide by the state law renders the foreclosure void, and the deed will be refused for recording.

• The mediation service under the ordinance and law is through the same entity (as of this writing), namely Rhode Island Housing.