By one vote, NH House rejects tighter foreclosure rules

Bill would have required signed verification before proceeding

A bill that would have required financial institutions to verify that homeowners has been notified before foreclosing on their residence was defeated by one vote Wednesday in the NH House.

House Bill 385 would have blocked a lender from moving forward on foreclosure if the borrower failed to sign the receipt for delivery of notice.

Rep. John Hunt, R-Rindge, chair of the House Commerce Committee, which recommended killing the bill by an 11-9 vote, argued that the bill would create a way for delinquent homeowners to hang on to their home by simply ignoring a foreclosure notice.

“If you are able to dodge the foreclosure notice, they can’t foreclose on you,” he said. He said it is almost “dangling” an escape clause. “Hide – don’t sign that green card,” said Hunt.

But Rep. Kermit Williams, D-Wilton, presented the example of someone who is away from their home while vacationing or even taking care of a sick parent for months. During that time, he said, a mortgage could be sold, and the checks being sent to the previous mortgage servicer aren’t forwarded to the new one, as they should have been.

“You come home, and there’s a lock on your door, and your stuff is gone,” he said. “Unless you know what is happening, before you know it, it is done.”

The example might have seemed farfetched, but a homeowner testified to the committee “that it happened just like that,” said Williams.

Since New Hampshire foreclosures don’t require court approval, “any screw-up by the bank are yours to unscrew,” added Williams.

Hunt said that the law has improved since the Great Recession, and that those who do sign the notice are offered a way to delay foreclosure. “Homeowners have plenty of protection,” he said.

But Williams argued that things haven’t changed that much. “We have the same banks, and the same people running those banks.” He said that homeowners who don’t sign can be served personally, as they do in court cases.

The House voted to kill the bill 177-176.

In other real estate-related business:

 • The House passed HB 305, which would make sure that month-to-month tenants who are leaving are on the hook for the next month’s rent if they don’t give notice. Courts have ruled as much, but this puts it into statute.

 • The House also passed HB 265, which would remove any mandate that municipalities zone for accessory dwelling units for manufacturing housing, condos and townhouses, though towns and cities could include that requirement if they wish.