Bill

Bill > SB534


OR SB534

Relating to allowable claims of equity in a property that is subject to a reverse mortgage; declaring an emergency.


summary

Introduced
01/13/2025
In Committee
01/17/2025
Crossed Over
Passed
Dead

Introduced Session

2025 Legislative Measures

Bill Summary

The statement includes a measure digest written in compliance with applicable readability standards. Digest: Lets a lender who gives a lump sum as the loan in a reverse mortgage get only that part of the total equity in the house to which the lump sum is equal at the time the lender gives the lump sum. (Flesch Readability Score: 61.4) Allows a lender that, in a reverse mortgage, provides a lump sum in exchange for a claim upon the equity of a property to claim as the lender’s equity, and receive as proceeds in a sale of the property, not more than the percentage of the total equity in the property to which the lump sum is equivalent on the date the lender provides the lump sum. Declares an emergency, effective on passage.

AI Summary

This bill modifies Oregon law regarding reverse mortgages by establishing clearer regulations and protections for borrowers. The bill defines key terms like "clear and conspicuous" and "reverse mortgage," and requires lenders to provide comprehensive written disclosures to borrowers before entering into a reverse mortgage agreement. These disclosures must explain critical details such as potential loss of home equity, fees and costs associated with the mortgage, how the loan balance grows over time, the borrower's ongoing responsibilities for property taxes and maintenance, and tax implications. A significant new provision limits lenders to claiming only the percentage of property equity that corresponds to the original lump sum loan amount, effectively preventing lenders from claiming more equity than their initial investment. The bill applies to reverse mortgage contracts entered into on or after its effective date and is declared an emergency measure, meaning it takes effect immediately upon passage. The goal appears to be protecting homeowners from potentially predatory lending practices by ensuring transparency and restricting lenders' equity claims in reverse mortgage transactions.

Committee Categories

Housing and Urban Affairs

Sponsors (2)

Last Action

Public Hearing held. (on 02/05/2025)

bill text


bill summary

Loading...

bill summary

Loading...
Loading...