Ohio-2013-HB613-Introduced

As Introduced

130th General Assembly

Regular Session

2013-2014

H. B. No. 613

Representative Anielski

A BILL

To amend sections 2329.01, 2329.17, 2329.20, 2329.26,

2329.27, and 2329.33 and to enact sections

2330.01, 2330.02, 2330.03, 2330.04, 2330.041,

2330.05, 2330.06, 2330.07, 2330.08, 2330.09,

2330.10, 2330.11, and 2330.12 of the Revised Code

to establish the Private Foreclosure Fast-Track

Law.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 2329.01, 2329.17, 2329.20, 2329.26,	8
2329.27, and 2329.33 be amended and sections 2330.01, 2330.02,	9
2330.03, 2330.04, 2330.041, 2330.05, 2330.06, 2330.07, 2330.08,	10
2330.09, 2330.10, 2330.11, and 2330.12 of the Revised Code be	11
enacted to read as follows:	12

Sec. 2329.01. ~~Lands~~Except as provided in Chapter 2330. of	13
the Revised Code, lands and tenements, including vested legal	14
interests therein, permanent leasehold estates renewable forever,	15
and goods and chattels, not exempt by law, shall be subject to the	16
payment of debts, and liable to be taken on execution and sold as	17
provided in sections 2329.02 to 2329.61~~, inclusive,~~ of the Revised	18
Code.	19

Sec. 2329.17. (A) ~~When~~Except as provided in section 2330.08	20
of the Revised Code, when execution is levied upon lands and	21
tenements, the officer who makes the levy shall call an inquest of	22
three disinterested freeholders, residents of the county where the	23
lands taken in execution are situated, and administer to them an	24
oath impartially to appraise the property so levied upon, upon	25
actual view. They forthwith shall return to such officer, under	26
their hands, an estimate of the real value of the property in	27
money.	28

(B) The municipal corporation or township in which the real	29
property is situated may inspect prior to the judicial sale any	30
structures located on lands subject to a writ of execution.	31

Sec. 2329.20. NoExcept as provided in section 2330.08 of	32
the Revised Code, no tract of land shall be sold for less than	33
two-thirds of the value returned in the inquest required by	34
section 2329.17 of the Revised Code; except that in all cases	35
where a junior mortgage or other junior lien is sought to be	36
enforced against real estate by an order, judgment, or decree of	37
court, subject to a prior lien thereon, and such prior lien, and	38
the claims or obligations secured thereby, are unaffected by such	39
order, judgment, or decree, the court making such order, judgment,	40
or decree, may determine the minimum amount for which such real	41
estate may be sold, such minimum amount to be not less than	42
two-thirds of the difference between the value of the real estate	43
appraised as provided in such section, and the amount remaining	44
unpaid on the claims or obligations secured by such prior lien.	45

Sec. 2329.26. (A) ~~Lands~~Except as provided in Chapter 2330.	46
of the Revised Code, lands and tenements taken in execution shall	47
not be sold until all of the following occur:	48

(1)(a) Except as otherwise provided in division (A)(1)(b) of	49
this section, the judgment creditor who seeks the sale of the	50
lands and tenements or the judgment creditor's attorney does both	51
of the following:	52

(i) Causes a written notice of the date, time, and place of	53
the sale to be served in accordance with divisions (A) and (B) of	54
Civil Rule 5 upon the judgment debtor and upon each other party to	55
the action in which the judgment giving rise to the execution was	56
rendered;	57

(ii) At least seven calendar days prior to the date of the	58
sale, files with the clerk of the court that rendered the judgment	59
giving rise to the execution a copy of the written notice	60
described in division (A)(1)(a)(i) of this section with proof of	61
service endorsed on the copy in the form described in division (D)	62
of Civil Rule 5.	63

(b) Service of the written notice described in division	64
(A)(1)(a)(i) of this section is not required to be made upon any	65
party who is in default for failure to appear in the action in	66
which the judgment giving rise to the execution was rendered.	67

(2) The officer taking the lands and tenements gives public	68
notice of the date, time, and place of the sale once a week for at	69
least three consecutive weeks before the day of sale by	70
advertisement in a newspaper of general circulation in the county.	71
The newspaper shall meet the requirements of section 7.12 of the	72
Revised Code. The court ordering the sale may designate in the	73
order of sale the newspaper in which this public notice shall be	74
published.	75

(3) The officer taking the lands and tenements shall collect	76
the purchaser's information required by section 2329.271 of the	77
Revised Code.	78

(B) A sale of lands and tenements taken in execution may be	79
set aside in accordance with division (A) or (B) of section	80
2329.27 of the Revised Code.	81

Sec. 2329.27. (A) When the public notice required by	82
division (A)(2) of section 2329.26 of the Revised Code is made in	83
a newspaper published weekly, it is sufficient to insert it for	84
three consecutive weeks. If both a daily and weekly edition of the	85
paper are published and the circulation of the daily in the county	86
exceeds that of the weekly in the county, or if the lands and	87
tenements taken in execution are situated in a city, both a daily	88
and weekly edition of the paper are published, and the circulation	89
of the daily in that city exceeds the circulation of the weekly in	90
that city, it is sufficient to publish the public notice in the	91
daily once a week for three consecutive weeks before the day of	92
sale, each insertion to be on the same day of the week. The	93
expense of that publication in a daily shall not exceed the cost	94
of publishing it in a weekly.	95

(B)(1) ~~Subject~~Except as provided in Chapter 2330. of the	96
Revised Code and subject to divisions (B)(2) and (3) of this	97
section, all sales of lands and tenements taken in execution that	98
are made without compliance with the written notice requirements	99
of division (A)(1)(a) of section 2329.26 of the Revised Code, the	100
public notice requirements of division (A)(2) of that section, the	101
purchaser information requirements of section 2329.271 of the	102
Revised Code, and division (A) of this section shall be set aside,	103
on motion by any interested party, by the court to which the	104
execution is returnable.	105

(2) Proof of service endorsed upon a copy of the written	106
notice required by division (A)(1)(a) of section 2329.26 of the	107
Revised Code shall be conclusive evidence of the service of the	108
written notice in compliance with the requirements of that	109
division, unless a party files a motion to set aside the sale of	110
the lands and tenements pursuant to division (B)(1) of this	111
section and establishes by a preponderance of the evidence that	112
the proof of service is fraudulent.	113

(3) If the court to which the execution is returnable enters	114
its order confirming the sale of the lands and tenements, the	115
order shall have both of the following effects:	116

(a) The order shall be deemed to constitute a judicial	117
finding as follows:	118

(i) That the sale of the lands and tenements complied with	119
the written notice requirements of division (A)(1)(a) of section	120
2329.26 of the Revised Code and the public notice requirements of	121
division (A)(2) of that section and division (A) of this section,	122
or that compliance of that nature did not occur but the failure to	123
give a written notice to a party entitled to notice under division	124
(A)(1)(a) of section 2329.26 of the Revised Code has not	125
prejudiced that party;	126

(ii) That all parties entitled to notice under division	127
(A)(1)(a) of section 2329.26 of the Revised Code received adequate	128
notice of the date, time, and place of the sale of the lands and	129
tenements;	130

(iii) That the purchaser has submitted the contact	131
information required by section 2329.271 of the Revised Code.	132

(b) The order bars the filing of any further motions to set	133
aside the sale of the lands and tenements.	134

Sec. 2329.33. InExcept as provided in section 2330.10 of	135
the Revised Code, in sales of real estate on execution or order of	136
sale, at any time before the confirmation thereof, the debtor may	137
redeem it from sale by depositing in the hands of the clerk of the	138
court of common pleas to which such execution or order is	139
returnable, the amount of the judgment or decree upon which such	140
lands were sold, with all costs, including poundage, and interest	141
at the rate of eight per cent per annum on the purchase money from	142
the day of sale to the time of such deposit, except where the	143
judgment creditor is the purchaser, the interest at such rate on	144
the excess above ~~his~~the judgment creditor's claim. The court of	145
common pleas thereupon shall make an order setting aside such	146
sale, and apply the deposit to the payment of such judgment or	147
decree and costs, and award such interest to the purchaser, who	148
shall receive from the officer making the sale the purchase money	149
paid by ~~him~~the purchaser, and the interest from the clerk. This	150
section does not take away the power of the court to set aside	151
such sale for any reason for which it might have been set aside	152
prior to April 16, 1888.	153

Sec. 2330.01. As used in this chapter:

154

(A) "Agricultural property" means any tract, lot, or parcel	155
of land on the agricultural land tax list maintained under section	156
5713.33 of the Revised Code.	157

(B) "Clerk" means the clerk of the court of common pleas of	158
the county in which the specified residential property is located,	159
the clerk of court of the municipal court in which the specified	160
residential property is located, or the clerk of courts of the	161
federal district court in which the specified residential property	162
is located, as applicable.	163

(C) "County land reutilization corporation" means a county	164
land reutilization corporation in good standing organized under	165
section 1724.04 of the Revised Code.	166

(D) "Court" means the court of common pleas, municipal court,	167
housing or environmental division of common pleas or municipal	168
court, or federal court having jurisdiction over the specified	169
residential property.	170

(E) "Designated law enforcement officer" means the sheriff or	171
the sheriff's authorized agent or representative of the county in	172
which the specified residential property is located, the bailiff	173
or the bailiff's authorized agent or representative of the	174
municipal court in which the specified residential property is	175
located, or the marshal or the marshal's authorized agent or	176
representative of the federal district in which the specified	177
residential property is located.	178

(F) "Electing subdivision" has the same meaning as in section	179
5722.01 of the Revised Code.	180

(G) "Financial institution" means either of the following:

181

(1) A lender, bank, or other financial institution or its	182
successors or assigns that owns a residential mortgage as a	183
mortgagee and that is regularly engaged in the business of	184
underwriting and making loans secured by real property;	185

(2) A financial institution or its successors or assigns that	186
purchases mortgages from institutions described in division (G)(1)	187
of this section whether as an assignee of the financial	188
institution or a servicer or trustee for institutions described in	189
this division, including a servicer of mortgages or the	190
purchaser's successors and assigns.	191

(H) "Residential mortgage" means an obligation to pay a sum	192
of money to a financial institution as evidenced by a promissory	193
note that is secured by a first mortgage lien of a financial	194
institution upon a residential property.	195

(I) "Residential property" means unoccupied property located	196
within this state that serves as security for a residential	197
mortgage and consists of real property that is unimproved by any	198
building or structure or real property improved by a building or	199
structure comprised solely of four or fewer dwelling units that	200
are each intended for residential occupancy.	201

"Residential property" may include a residential condominium	202
unit owned by any person or entity, notwithstanding the number of	203
units in the structure of which the condominium is a part; a row	204
house, notwithstanding the number of units of which the row house	205
is a part; and a manufactured or mobile home that is subject to	206
real property taxes under section 4503.06 of the Revised Code.	207

(J) "Unoccupied property" means any of the following:

208

(1) Real property that is abandoned land as defined in	209
section 323.65 of the Revised Code;	210

(2) Real property on which no trade or business is actively	211
being conducted by the owner or another party occupying the	212
property pursuant to any lease or other legal authority;	213

(3) Real property that is uninhabited with no signs or active	214
indications that it is undergoing improvements as evidenced by an	215
unexpired building permit, an unexpired application for a building	216
permit, or other facts indicating the property is undergoing	217
ongoing improvements;	218

(4) Real property that is uninhabited and that contains one	219
or more buildings or structures that are unsecured;	220

(5) In the case of real property unimproved by any building	221
or structure, for which a visual inspection shows no exterior	222
indications that such unimproved property serves as an immediate	223
and active accessory use to an adjacent occupied property for such	224
purposes as lawful parking, ingress and egress, lawful storage, or	225
yard extension of an occupied property and that is not	226
agricultural property;	227

(6) Real property on which one or more utility connections,	228
including water, sewer, natural gas, or electric connections, are	229
no longer servicing the property or one or more of such utility	230
connections are not actively being billed by any utility provider	231
to the property;	232

(7) Real property on which one or more buildings or	233
structures on the property are boarded up or otherwise sealed in	234
order to prevent the property from becoming unsecured, or because	235
such boarding up or sealing was ordered by a governmental body	236
pursuant to its applicable municipal, county, state, or federal	237
nuisance authority;	238

(8) Real property that is condemned or otherwise declared a	239
nuisance for any reason by a governmental body.	240

(K) "Unsecured" means conditions that would permit entry into	241
a building or structure including, but not limited to, broken	242
windows, broken doors, or other indications that the building or	243
structure is open or vandalized.	244

Sec. 2330.02. (A) In lieu of initiating foreclosure	245
proceedings under Chapter 2329. or any other chapter of the	246
Revised Code against residential property that secures a	247
residential mortgage held by a financial institution, a financial	248
institution may bring an expedited foreclosure action against an	249
owner of a residential property as prescribed in this chapter.	250
Such expedited foreclosure proceedings may be pursued in the	251
courts of common pleas, municipal courts, and the federal district	252
courts in which the residential property is located and consistent	253
with their respective subject matter jurisdiction.	254

(B) By electing to pursue an action pursuant to this chapter,	255
the financial institution shall be required to abide by the	256
provisions of this chapter. Except as otherwise specifically	257
authorized in this chapter, an action commenced under this chapter	258
shall continue and conclude under this chapter. A financial	259
institution shall not be permitted to voluntarily dismiss or seek	260
to vacate a judgment, order of sale, writ of execution, sale,	261
transfer, or confirmation of the action except as provided in	262
division (B) of section 2330.04 of the Revised Code or upon	263
written motion in the court's sound discretion for good cause	264
shown by clear and convincing evidence.	265

Sec. 2330.03. A court may adopt local rules and case	266
management orders not inconsistent with this chapter for the	267
purpose of implementing, as necessary, the expedited foreclosure	268
of residential properties as prescribed under this chapter. If	269
during the pendency of any action brought under this chapter, the	270
court determines that the real property being foreclosed on is	271
not, or is no longer, residential property, then such action shall	272
not be dismissed, but shall be pursued in accordance with Chapter	273
2329. of the Revised Code. The court may utilize the procedures	274
provided in Chapter 2329. of the Revised Code as the court finds	275
convenient or necessary to supplement the court's proceedings,	276
provided those procedures are not inconsistent with this chapter.	277

Sec. 2330.04. (A) An action filed under this chapter shall	278
be filed with the clerk in the same manner as in other civil	279
actions. The clerk shall provide summons and notice of complaint	280
accompanied by an affidavit prescribed in division (B)(3) of this	281
section and subsequent hearings as provided in this section,	282
maintain an official case file, docket all proceedings, and tax as	283
costs all necessary expenses in connection with the action. The	284
clerk may utilize the court's existing journal, case numbering	285
system, and general procedures, or may maintain a separate	286
journal, case numbering, or docketing index called the	287
"foreclosure fast-track" docket or such similar designation to	288
identify that filings under this chapter are intended to proceed	289
on an expedited basis.	290

(B) A financial institution acting as plaintiff may initiate	291
a foreclosure action under this chapter upon a residential	292
property by filing a complaint with the clerk in form similar to	293
pleading and caption forms provided in the Ohio and federal Rules	294
of Civil Procedure, as applicable. All of the following shall	295
accompany such complaint:	296

(1) The preliminary judicial report as required by section	297
2329.191 of the Revised Code, which includes the name and address	298
of all parties having any interest of record in the property;	299

(2) A copy of the promissory note and the residential	300
mortgage secured by the residential property. If either the	301
promissory note or residential mortgage are not originals, then	302
the affiant of an affidavit described in division (B)(3) of this	303
section shall attest on personal knowledge that the promissory	304
note and residential mortgage are true and accurate copies of the	305
originals to the best of the affiant's good faith knowledge and	306
belief.	307

(3) One of the following:

308

(a) The affidavit described in division (H) of this section;	309
or	310

(b) An affidavit that adequately identifies the property and	311
in which both the plaintiff and the owners of record of the	312
property stipulate or otherwise agree that the property being	313
foreclosed upon is to be deemed residential property as defined in	314
section 2330.01 of the Revised Code.	315

(4) If the plaintiff requests that the residential property	316
be directly transferred to a county land reutilization corporation	317
or other electing subdivision upon the court's issuance of a	318
decree of foreclosure, an affidavit that is signed and notarized	319
by both the financial institution and the county land	320
reutilization corporation or other electing subdivision that	321
indicates that the financial institution and county land	322
reutilization corporation or other electing subdivision are in	323
agreement to the court's direct transfer of the residential	324
property to the county land reutilization corporation or other	325
electing subdivision.	326

The plaintiff may include other documents or information with	327
the complaint that the plaintiff asserts is relevant to the	328
proceeding.	329

If an affidavit described in division (B)(4) of this section	330
is not filed with the complaint, the plaintiff and the county land	331
reutilization corporation or electing subdivision may file the	332
affidavit not later than seven days prior to any final hearing.	333
The county land reutilization corporation or other electing	334
subdivision may unilaterally withdraw any consent to accept any	335
residential property by filing a supplemental signed and notarized	336
instrument revoking the consent. The supplemental instrument must	337
be filed not later than seven days prior to any final hearing. In	338
the event of such revocation, the plaintiff, by filing notice to	339
the court, may elect to proceed under this chapter or Chapter	340
2329. of the Revised Code or may move for a dismissal of the	341
action.	342

(C) Upon the filing of a complaint under this chapter, the	343
clerk promptly shall serve notice of the summons, complaint, and	344
affidavit filed in accordance with division (B)(3) of this section	345
to the last known address of the record owner of the residential	346
property being foreclosed upon and the last known address of each	347
lienholder or other person having an interest of record identified	348
in the preliminary judicial report consistent with Civil Rule 4.	349
The notice of summons shall be included with the complaint and	350
prepared by the clerk in substantial form as prescribed in section	351
2330.041 of the Revised Code. The notice of summons shall inform	352
the addressee of all of the following:	353

(1) That the financial institution alleges that the	354
residential mortgage on the residential property is in default and	355
that if so determined by the court all of the following may occur:	356

(a) The residential property shall be sold at public auction	357
or transferred directly to the financial institution, a county	358
land reutilization corporation, or other electing subdivision	359
without appraisal and without auction sale on a date and in a	360
manner as prescribed in this chapter or as ordered by the court.	361

(b) Any owner of record or any other lienholder or other	362
party with a recorded interest in the residential property may	363
lose all interest in the residential property, including all	364
statutory or common law equity of redemption or other interest in	365
the residential property, if the residential mortgage is not paid,	366
settled, modified, or otherwise resolved by some other accord and	367
satisfaction between the financial institution and the owner or	368
any other lienholder or interest holder in the residential	369
property.	370

(2) That any owner of the residential property, in order to	371
redeem the property, must pay, settle, have modified, or reach an	372
accord and satisfaction at any time before the expiration of the	373
equity of redemption as provided in section 2330.10 of the Revised	374
Code.	375

(3) That the action is being prosecuted by a financial	376
institution and the name, address, and telephone number of the	377
attorney for the financial institution;	378

(4) The case number assigned by the clerk;

379

(5) That all subsequent pleadings, motions, and papers	380
associated with the case and filed by any interested party must be	381
filed with the clerk and will become part of the case file unless	382
a party is deemed to be in default of the proceedings as described	383
in section 2330.05 of the Revised Code.	384

(D)(1) Subsequent pleadings, motions, and papers following	385
notice of the summons, complaint, and affidavit shall be filed	386
with the clerk and shall be served by the filing party upon all	387
parties of record, except in the case of parties deemed to be in	388
default of the proceedings as described in section 2330.05 of the	389
Revised Code.	390

(2) Notwithstanding division (F) of this section, service by	391
publication in any case requiring such service shall be advertised	392
in the manner prescribed by Civil Rule 4.4 except that, if service	393
by publication is necessary, such publication shall be made once a	394
week for three consecutive weeks, and the service shall be	395
complete at the expiration of three weeks after the date of the	396
first publication. In any action brought under this chapter, if	397
the plaintiff determines that service upon a defendant may be	398
obtained ultimately only by publication, the plaintiff may cause	399
service to be made simultaneously by certified mail, return	400
receipt requested, ordinary mail, and publication. Parties served	401
by certified or ordinary mail are not required to file an answer	402
to the complaint. A party served by publication must appear, move,	403
or plead to the complaint within twenty-eight days after service	404
is completed, or such party shall be deemed in default of	405
proceedings.	406

(E) Any inadvertent noncompliance with the rules in this	407
chapter not materially affecting notice and opportunity to appear	408
at a final hearing as described in section 2330.06 of the Revised	409
Code shall not serve to defeat or terminate the case or subject	410
the case to dismissal if notice or service of the summons and	411
complaint, if challenged, can be proven by a preponderance of the	412
evidence or are acknowledged by the party charged with notice or	413
service. Any irregularity that materially affects notice and	414
opportunity to appear shall be deemed waived if the party charged	415
with notice makes an appearance in the action or makes a filing in	416
relation to the action.	417

(F) Expedited foreclosure proceedings under this chapter	418
constitute special statutory proceedings pursuant to Civil Rule 1,	419
and as such, except for the service of process as prescribed in	420
this chapter and in Civil Rule 4, are exempted from the Civil	421
Rules. However, the court may utilize the procedures contained in	422
the applicable Rules of Civil Procedure to the extent that such	423
use facilitates the practical or efficient conduct and purposes of	424
proceedings undertaken pursuant to this chapter, such as vacating	425
orders, correcting clerical mistakes, and providing notice to the	426
parties.	427

(G) For purposes of efficiently and promptly implementing the	428
provisions of this chapter, the court, clerk, and designated law	429
enforcement officer may adopt, not inconsistent with this chapter,	430
such practice forms, forms of notice of hearings and notice to	431
parties, forms of orders, adjudications, fees, publication forms,	432
deed forms, and other procedures customarily within their official	433
purview or duties.	434

(H) "Affidavit," as required by division (B)(3)(a) of this	435
section, means an affidavit required to be signed and attested to	436
either by the attorney filing the foreclosure action on behalf of	437
the financial institution or a representative of the financial	438
institution that based on information and belief attests to and	439
contains the following information:	440

(1) That the declarant has authority from the financial	441
institution to execute the affidavit;	442

(2) That the declarant has knowledge based on reasonable	443
information and belief of the facts contained in the affidavit;	444

(3) That the property being foreclosed upon is residential	445
property as defined in section 2330.01 of the Revised Code.	446

(4) The permanent parcel numbers and, if available, the	447
common address of the property;	448

(5) An original signature by the attesting declarant;

449

(6) An original notarization on the affidavit by an	450
authorized notary in this state or the state and county of such	451
declarant's residence;	452

(7) The name, address, and telephone number of the individual	453
upon whose information the declarant's information and belief is	454
based.	455

Sec. 2330.041. The notice of summons prepared by the court	456
pursuant to division (C) of section 2330.04 of the Revised Code	457
shall be in substantially the following form:	458

THIS IS A FORECLOSURE LAWSUIT BEING PROSECUTED IN THE (NAME	459
OF COURT). YOU HAVE BEEN NAMED AS A DEFENDANT IN THIS SUIT AS	460
SOMEONE WHO HAS AN INTEREST IN THE FOLLOWING PARCEL OF LAND:	461

(DESCRIPTION AS SHOWN IN COMPLAINT)

462

THIS PARCEL HAS BEEN INCLUDED IN AN ACTION INSTITUTED BY	463
(NAME OF FINANCIAL INSTITUTION), BEING CASE NO. (CASE NUMBER)	464
FILED IN THE (NAME OF COURT), (LOCATION), OHIO, ON (DATE OF	465
FILING) SEEKING THE EXPEDITED FORECLOSURE AND SALE OR DIRECT	466
TRANSFER OF THE PARCEL AS A RESULT OF THE ALLEGED DEFAULT OF A	467
RESIDENTIAL MORTGAGE HELD BY THE ABOVE NAMED FINANCIAL INSTITUTION	468
AGAINST THE PARCEL. THE ATTORNEY REPRESENTING THE FINANCIAL	469
INSTITUTION IN THIS MATTER IS: (NAME OF ATTORNEY FOR FINANCIAL	470
INSTITUTION), WITH OFFICES AT (ATTORNEY'S BUSINESS ADDRESS), AND A	471
BUSINESS PHONE NUMBER OF (ATTORNEY'S BUSINESS PHONE NUMBER).	472

ANY PERSON OWNING OR CLAIMING ANY RIGHT, TITLE, OR INTEREST	473
IN, OR LIEN UPON, THIS PARCEL MUST APPEAR AT ANY HEARING SCHEDULED	474
BY THE COURT IN ORDER TO SET FORTH THE NATURE AND AMOUNT OF THE	475
PERSON'S INTEREST AND ANY DEFENSE OR OBJECTION TO THE FORECLOSURE.	476
ALL SUBSEQUENT PLEADINGS, MOTIONS, AND PAPERS SHALL BE FILED IN	477
THE OFFICE OF THE UNDERSIGNED CLERK OF THE COURT, AND A COPY OF	478
ANY SUCH PLEADINGS, MOTIONS, AND PAPERS SHALL BE DELIVERED TO THE	479
ATTORNEY FOR THE FINANCIAL INSTITUTION ON OR BEFORE THE DATE OF	480
ANY FINAL HEARING.	481

IF YOU DO NOT APPEAR AT ANY HEARING SCHEDULED BY THE COURT, A	482
JUDGMENT OF FORECLOSURE MAY LIKELY BE TAKEN AGAINST YOU BY DEFAULT	483
AND THE PARCEL SHALL BE ORDERED SOLD AT PUBLIC AUCTION OR	484
TRANSFERRED DIRECTLY TO THE FINANCIAL INSTITUTION, A COUNTY LAND	485
REUTILIZATION CORPORATION, OR OTHER ELECTING SUBDIVISION AS	486
DEFINED IN CHAPTERS 1724. AND 5722. OF THE REVISED CODE WITHOUT	487
APPRAISAL AND WITHOUT AUCTION SALE ON A DATE AND IN A MANNER	488
PURSUANT TO SECTION 2330.08 OF THE REVISED CODE OR AS OTHERWISE	489
ORDERED BY THE COURT.	490

THE OWNER OR LIENHOLDER OF, OR OTHER PERSON WITH A RECORDED	491
INTEREST IN, A PARCEL MAY LOSE ALL ITS INTEREST IN THE RESIDENTIAL	492
PROPERTY, IF THE RESIDENTIAL MORTGAGE IS NOT PAID, SETTLED,	493
MODIFIED, OR OTHERWISE RESOLVED BY SOME OTHER ACCORD AND	494
SATISFACTION WITH THE FINANCIAL INSTITUTION AND THE OWNER OR A	495
LIENHOLDER OR PARTY WITH A RECORDED INTEREST IN THE PARCEL.	496

IN ORDER TO REDEEM THE PARCEL, THE OWNER OF THE RESIDENTIAL	497
PROPERTY MUST PAY, SETTLE, HAVE MODIFIED, OR REACH AN ACCORD AND	498
SATISFACTION AT ANY TIME PRIOR TO A JOURNALIZED ENTRY OF AN ORDER	499
FOR DIRECT TRANSFER PURSUANT TO SECTION 2330.07 OF THE REVISED	500
CODE, OR A JOURNALIZED ENTRY OF A CONFIRMATION OF SALE.	501

UPON THE FILING OF ANY ENTRY ORDERING THE DIRECT TRANSFER OF,	502
OR CONFIRMING THE SALE OF, THE PARCEL, THERE SHALL BE NO FURTHER	503
EQUITY OF REDEMPTION. AFTER THE FILING OF ANY SUCH ENTRY, ANY	504
PERSON CLAIMING ANY RIGHT, TITLE, OR INTEREST IN, OR LIEN UPON,	505
THE PARCEL SHALL BE FOREVER BARRED AND FORECLOSED OF ANY SUCH	506
RIGHT, TITLE, OR INTEREST IN, LIEN UPON, AND ANY EQUITY OF	507
REDEMPTION IN, THE PARCEL.	508

............................

509

CLERK OF THE COURT

510

.................. COURT

511

................., OHIO"

512

Sec. 2330.05. (A) A party shall be deemed to be in default	513
of the proceedings in an action brought under this chapter if	514
either of the following occurs:	515

(1) The party fails to appear at any hearing after being	516
served with notice of the summons and complaint by certified or	517
ordinary mail.	518

(2) For a party upon whom notice of summons and complaint is	519
required by publication and has been deemed served, the party	520
fails to appear, move, or plead to the complaint within	521
twenty-eight days after service by publication is completed.	522

(B) If a party is deemed in default pursuant to division (A)	523
of this section, no further service of any subsequent pleadings,	524
papers, or proceedings is required on the party by the court or	525
any other party. Any valuation hearings held in accordance with	526
section 2330.11 of the Revised Code and any other interim or	527
ancillary hearings prior to any final hearing, and any orders,	528
notices, or continuances shall only be required to be sent to	529
those parties not in default. The court shall neither require nor	530
order such further notice to one or more of such parties unless	531
the failure to do so shall result in manifest and substantial	532
injustice.	533

(C) If a party is deemed in default pursuant to division (A)	534
of this section, the subsequent appearance, motion, or pleading of	535
that party shall not automatically alter the status of that party	536
as being in default. The party shall remain in defaulted status	537
and shall not be entitled to service of subsequent pleadings,	538
papers, and orders unless the defaulted party shows one of the	539
following:	540

(1) That the failure to change the defaulted status results	541
in, and the court so finds, a manifest and substantial injustice	542
to one or more parties;	543

(2) Excusable neglect based on facts asserted with	544
particularity;	545

(3) That the property in question is not residential property	546
based on a preponderance of the evidence.	547

Conclusory assertions shall be insufficient to challenge a	548
party's defaulted status under this division.	549

(D) With respect to any issue over a party's defaulted	550
status, the court may conduct evidentiary hearings on the	551
sufficiency of process, service of process, or sufficiency of	552
service of process, in any proceeding arising from a complaint	553
under this chapter.	554

Sec. 2330.06. (A) The court shall order and conduct a final	555
hearing on the merits of a complaint to initiate an expedited	556
foreclosure on a residential property, including the validity or	557
amount of any obligations under the residential mortgage, not	558
sooner than thirty days after service of notice of summons,	559
complaint, and affidavit has been perfected in accordance with	560
section 2330.04 of the Revised Code, if the court determines that	561
all of the following apply:	562

(1) All parties to the complaint have been served.

563

(2) No individual named in the complaint is on active	564
military duty and thereby not available.	565

(3) The complaint, preliminary judicial report, and affidavit	566
are before the court for the court's review.	567

(B) Upon the occurrence of the conditions listed in divisions	568
(A)(1) to (3) of this section, the court shall schedule a final	569
hearing on the merits without the necessity of any pretrials,	570
status conferences, or other interim proceedings. If within	571
fourteen days after the occurrence of the conditions listed in	572
divisions (A)(1) to (3) of this section, a court does not on its	573
own initiative order and schedule within one hundred eighty days	574
of such scheduling a final hearing on the merits of a complaint to	575
initiate a foreclosure as described in division (A) of this	576
section, then the plaintiff may thereafter file a motion	577
requesting that the court order and conduct a final hearing on the	578
merits of the complaint, including the validity or amount of any	579
obligations under the residential mortgage. Upon such motion, the	580
court shall so order and conduct the final hearing not sooner than	581
thirty days after notice of service of summons, complaint, and	582
affidavit and not later than one hundred eighty days after the	583
filing date of the plaintiff's request for the final hearing.	584

(C) Proceedings under this chapter shall be limited in	585
subject matter to:	586

(1) Substantial conformity of the complaint, affidavit, and	587
preliminary judicial report to the proceedings authorized in this	588
chapter;	589

(2) Sufficiency of process and sufficiency of service of	590
process;	591

(3) Whether a party is in default of any proceedings as	592
provided in section 2330.05 of the Revised Code;	593

(4) The validity or amount of any obligations under the	594
residential mortgage;	595

(5) Whether the property being foreclosed upon is	596
"residential property" as defined in this chapter;	597

(6) Whether the mortgagor or plaintiff financial institution	598
is in default pursuant to the residential mortgage;	599

(7) The priority, validity, and amount of any obligations of	600
other lienholders to the residential mortgage. Counterclaims and	601
cross-claims, whether normally deemed compulsory or permissive	602
under the applicable Rules of Civil Procedure, may not be asserted	603
in any action taken under this chapter except as to whether the	604
financial institution is in breach of the residential mortgage or	605
the priority and validity of lienholders listed in the preliminary	606
judicial report. Counterclaims or cross-claims other than those	607
provided for in this chapter may be pursued by any party in a	608
separate action unless the court determines in its sound	609
discretion by clear and convincing evidence that substantial	610
justice requires inclusion of such claims.	611

(D) The court may make such findings of fact, conclusions of	612
law, and orders as it determines necessary as a result of the	613
final hearing. Before or subsequent to any decree of foreclosure,	614
the court may order the financial institution and any other	615
lienholders who have appeared and are not in default to stipulate	616
to their respective order of priority, or, failing the ability to	617
stipulate, conduct hearings and make findings to determine the	618
order of priority.	619

(E)(1) A court may deem a property to be a residential	620
property if, along with a complaint to initiate foreclosure, the	621
record owner of the residential property stipulates or otherwise	622
affirms in the affidavit described in division (B)(3)(b) of	623
section 2330.04 of the Revised Code that the property is to be	624
deemed residential property.	625

(2) All of the facts contained in the affidavit shall	626
constitute prima facie evidence and shall be rebuttably presumed	627
to be true, but may be rebutted to the court at any time prior to	628
the final hearing if, at the time a financial institution files an	629
action of foreclosure under this chapter, the complaint includes	630
an affidavit as described in division (H) of section 2330.04 of	631
the Revised Code that affirmatively asserts the property is	632
residential property.	633

(3) In the case of property unimproved by any building or	634
structure, if a party asserts an accessory use, the party making	635
the assertion must show the existence of the accessory use by a	636
preponderance of the evidence. Failure to assert any such	637
accessory use by any party at least seven days prior to any final	638
hearing as described in this section shall be deemed a waiver of	639
any such assertion and the property shall be deemed residential	640
property.	641

(F) After a final hearing, the court shall enter a decree of	642
foreclosure under this chapter if the court determines that the	643
information in the complaint, preliminary judicial report, copy of	644
the promissory note and residential mortgage that secures the	645
residential property, and affidavit as described in section	646
2330.04 of the Revised Code is sufficient to conclude that the	647
mortgagor is in default of the residential mortgage and the	648
property that secures the residential mortgage is residential	649
property.	650

Sec. 2330.07. (A) In an action for which the preliminary	651
judicial report as described in section 2329.191 of the Revised	652
Code states, and the court so finds, that the residential mortgage	653
is the first and only mortgage on the residential property and the	654
owner of the residential property is in default of the proceedings	655
by not having appeared, moved, or pled as described in section	656
2330.05 of the Revised Code, the court shall enter a decree of	657
foreclosure against the residential property and order the	658
property either sold pursuant to division (B) of section 2330.08	659
of the Revised Code, or upon petition of the financial institution	660
that filed the complaint under this chapter, transferred pursuant	661
to division (A) of section 2330.08 of the Revised Code.	662

(B) In an action for which the preliminary judicial report as	663
described in section 2329.191 of the Revised Code states, and the	664
court so finds, that the residential mortgage is the first and	665
only lien on the residential property and the owner of the	666
residential property is not in default of the proceedings, then	667
upon any finding in favor of the financial institution, whether by	668
acknowledgment by the owner at a hearing, stipulation of the	669
financial institution and the owner of the residential property,	670
or upon the court's finding after a final hearing, the court shall	671
enter a decree of foreclosure against the residential property and	672
order the property either sold pursuant to division (B) of section	673
2330.08 of the Revised Code, or upon petition of the financial	674
institution that filed the complaint under this chapter,	675
transferred pursuant to division (A) of section 2330.08 of the	676
Revised Code.	677

(C) In an action for which the preliminary judicial report as	678
described in section 2329.191 of the Revised Code states, and the	679
court so finds, that the residential mortgage is the first lien on	680
the residential property but there are other liens, or interested	681
parties of record, and the owner of the residential property and	682
all other lienholders and interested parties are in default of the	683
proceedings by not having appeared, moved, or pled as described in	684
section 2330.05 of the Revised Code, the court shall enter a	685
decree of foreclosure against the residential property and order	686
the property either sold pursuant to division (B) of section	687
2330.08 of the Revised Code, or upon petition of the financial	688
institution that filed the complaint under this chapter,	689
transferred pursuant to division (A) of section 2330.08 of the	690
Revised Code.	691

(D) In an action for which the preliminary judicial report as	692
described in section 2329.191 of the Revised Code states, and the	693
court so finds, that the residential mortgage is the first lien on	694
the residential property but there are other liens, and the owner	695
of the residential property or any other lienholder or interested	696
party is not in default of the proceedings, then upon any finding	697
in favor of the financial institution on the residential mortgage,	698
whether by acknowledgement at a hearing, stipulation of the	699
financial institution and the owner of the residential property,	700
or upon the court's finding after a final hearing, the court shall	701
enter a decree of foreclosure and order the residential property	702
disposed of in accordance with one of the following:	703

(1) If the residential mortgage balance as determined by the	704
court is greater than the fair market value of the residential	705
property, the court shall order the property either sold pursuant	706
to division (B) of section 2330.08 of the Revised Code, or upon	707
petition of the financial institution that filed the complaint	708
under this chapter, transferred pursuant to division (A) of	709
section 2330.08 of the Revised Code.	710

(2) If the residential mortgage balance as determined by the	711
court is less than the fair market value of the residential	712
property, the court shall order the property sold pursuant to	713
division (B) of section 2330.08 of the Revised Code.	714

To determine the fair market value of the residential	715
property for purposes of this section, the county auditor's most	716
recent valuation of the residential property shall be rebuttably	717
presumed to be the fair market value of the property. The	718
auditor's valuation is prima facie evidence of the actual fair	719
market value, which may be rebutted to the court by any party to	720
the action in accordance with section 2330.11 of the Revised Code.	721

(E) In any action described in divisions (A) to (D) of this	722
section, if the financial institution does not petition the court	723
for a direct transfer pursuant to division (A) of section 2330.08	724
of the Revised Code, regardless of the number of liens on the	725
residential property, or if the court denies a petition for a	726
direct transfer, the court, upon entering a decree of foreclosure,	727
shall order the residential property sold pursuant to division (B)	728
of section 2330.08 of the Revised Code.	729

(F)(1) In an action when one or more parties named as	730
defendants in the complaint are not in default of the proceedings	731
as described in section 2330.05 of the Revised Code and any matter	732
justiciable under division (C) of section 2330.06 of the Revised	733
Code is contested by one or more parties, the court may hear and	734
adjudicate the case under this chapter, or, in its sound	735
discretion, may hear and adjudicate the case according to the	736
court's normal case management schedule and local rules	737
notwithstanding the time requirements provided in divisions (A)	738
and (B) of section 2330.06 of the Revised Code.	739

(2) In an action in which all of the parites named as	740
defendants in the complaint are in default of the proceedings as	741
described in section 2330.05 of the Revised Code, the court shall	742
hear and adjudicate the case under the time requirements provided	743
in divisions (A) and (B) of section 2330.06 of the Revised Code,	744
unless the court finds specifically by clear and convincing	745
evidence that doing so will result in manifest and substantial	746
injustice to one or more parties.	747

Sec. 2330.08. (A) Upon the issuance of a decree of	748
foreclosure under this chapter on a residential property that the	749
financial institution has petitioned the court to order directly	750
transferred, and the court so orders the property directly	751
transferred, the court shall order the designated law enforcement	752
officer to prepare a deed without appraisal or exposure to sale to	753
the financial institution that brought the action, a county land	754
reutilization corporation, or other electing subdivision as	755
indicated in the financial institution's petition. Subject to	756
division (A)(2) of this section, the deed shall be free and clear	757
of all liens, encumbrances, and obligations, other than unpaid	758
taxes and assessments that may be delinquent, and such taxes and	759
assessments that are a lien on the residential property but not	760
yet due and payable. The order shall do the following:	761

(1) If the deed is prepared for the financial institution,	762
provide that upon the financial institution's payment of all taxes	763
and assessments and the costs of the proceedings, the designated	764
law enforcement officer shall deliver the deed directly to the	765
financial institution without appraisal and without sale;	766

(2) If the deed is prepared for a county land reutilization	767
corporation or other electing subdivision, provide that upon the	768
financial institution's payment of the costs of the proceedings,	769
the designated law enforcement officer shall deliver the deed to	770
the county land reutilization corporation or other electing	771
subdivision without appraisal and without sale. The direct	772
transfer of the residential property to a county land	773
reutilization corporation or other electing subdivision shall	774
extinguish the lien on the title for all taxes, assessments,	775
penalties, interest, and charges delinquent at the time of the	776
conveyance of the residential property to the county land	777
reutilization corporation or other electing subdivision, the same	778
as if such transfer were made to a county land reutilization	779
corporation or other electing subdivision in lieu of taxes	780
pursuant to section 5722.10 of the Revised Code. The financial	781
institution shall pay for the costs of the proceedings under this	782
division.	783

(B) Upon the issuance of a decree of foreclosure under this	784
chapter on a residential property for which the court does not	785
order the residential property directly transferred as provided in	786
section 2330.07 of the Revised Code, the court shall order the	787
sale of the residential property in the manner commonly performed	788
by the designated law enforcement officer of the county in which	789
the residential property is located except that the designated law	790
enforcement officer need only expose such property to sale one	791
time. Notwithstanding sections 2329.17 and 2329.20 of the Revised	792
Code, the minimum bid at sale shall be three hundred dollars, and	793
the residential property shall not be required to be appraised.	794
Chapter 2329. of the Revised Code and other applicable execution	795
statutes may be used for the disposition of the residential	796
property, not inconsistent with this chapter.	797

The purchaser of the residential property at any sale	798
pursuant to this division shall pay all current and delinquent	799
taxes and assessments on the residential property, except when the	800
purchaser is a county land reutilization corporation. The	801
financial institution shall pay the costs of the proceedings under	802
this division.	803

(C) The rights of the owner who owned the residential	804
property before a sale conducted pursuant to this chapter shall	805
remain unaffected by any excess or deficiency balance resulting	806
from the difference between the residential mortgage balance and	807
the sale price of the residential property pursuant to any	808
residential mortgage.	809

(D) If no person bids at a sale held pursuant to this	810
section, the financial institution invoking the provisions of this	811
chapter shall bid in sufficient amount, up to its residential	812
mortgage balance, to acquire the residential property. In that	813
event, the financial institution as purchaser, or its successor or	814
assigns at any sale, shall pay all current and delinquent taxes	815
and assessments on the residential property and the costs of the	816
proceedings under this chapter.	817

Sec. 2330.09. (A) The court shall prescribe deed forms and	818
issue orders of sale or orders of transfer as authorized in	819
division (C) of section 2327.02 of the Revised Code. The order of	820
sale, order of transfer, and deed forms and the description of the	821
residential property shall be ordered by the court so that at the	822
time of deed delivery to any party that obtains residential	823
property through direct transfer or sale as described in section	824
2330.07 of the Revised Code, the designated law enforcement	825
officer need only sign the deed and deliver the deed upon the	826
payment of all applicable purchase proceeds, costs, taxes, and	827
assessments, as applicable.	828

(B) By filing an action under this chapter, the plaintiff	829
authorizes and consents to the designated law enforcement officer	830
filing the deed, which shall constitute deed delivery.	831

Sec. 2330.10. (A) Notwithstanding section 2329.33 of the	832
Revised Code, a party entitled to redeem a residential property	833
after a decree of foreclosure is issued under this chapter shall	834
do so within the following time periods:	835

(1) In the case of a direct transfer made pursuant to section	836
2330.07 of the Revised Code, prior to the journalized entry of the	837
order to transfer, which may be included in the decree of	838
foreclosure or in a separate order to so transfer pursuant to a	839
decree. In the case of such a direct transfer, no further action	840
of the court shall be required after entry of the order, at which	841
point any statutory or common law equity of redemption in any	842
owner shall be deemed forever and entirely extinguished.	843

(2) In all other actions brought under this chapter, on or	844
before confirmation of sale, after which any statutory or common	845
law equity of redemption in any owner shall be deemed forever and	846
entirely extinguished.	847

(B) Upon the expiration of the time periods prescribed in	848
this section, a transfer to any transferee shall vest free and	849
clear fee simple title to the transferee free of all liens,	850
encumbrances, or charges in equity or law, except easements and	851
restrictions of record running with the land.	852

Sec. 2330.11. (A) For purposes of rebutting the presumption	853
of fair market value when value is rebuttably presumed pursuant to	854
division (D)(2) of section 2330.07 of the Revised Code, at any	855
time after the filing of the complaint, or upon the court's own	856
motion, but in no event later than fourteen days prior to any	857
final hearing, any party may file with the court a good faith	858
appraisal of the residential property from a licensed professional	859
appraiser and request a hearing to determine the fair market value	860
of the residential property. Any party may file additional	861
appraisals to refute or confirm any appraisal submitted by another	862
party. An appraisal shall not be submitted for any purpose other	863
than to rebut the presumption of value determined pursuant to	864
division (D)(2) of section 2330.07 of the Revised Code and any	865
appraisals in response to that determination.	866

(B) If proceedings on valuation require additional time	867
beyond that prescribed in this chapter, the court may proceed with	868
the case on its standard case docket as prescribed in division (F)	869
of section 2330.07 of the Revised Code, except that the court	870
shall dispose of the case as authorized in divisions (A) to (D) of	871
section 2330.07 and section 2330.09 of the Revised Code as	872
applicable, depending on the determination of fair market value	873
and to the extent such determination impacts the applicability of	874
those divisions and that section.	875

Sec. 2330.12. (A) Unless otherwise specifically prohibited	876
by the residential mortgage or a specific statutory provision of	877
law, a financial institution that has filed an action under this	878
chapter may enter into a residential property to secure and	879
protect it from harm if the property is unsecured.	880

(B) If entry as described in division (A) of this section is	881
prohibited by the residential mortgage documents or related	882
contractual documents, then, in the interest of public safety, the	883
court may authorize entry for such purposes by order either upon	884
petition or upon the court's own motion.	885

(C) A financial institution shall not be subjected to	886
criminal or civil liability for trespass, unauthorized entry,	887
invasion of privacy, building or housing code violations, or other	888
responsibility for the condition of the residential property due	889
to an entry authorized pursuant to division (A) of this section.	890
This section does not affect a financial institution's duties to	891
use ordinary care that existed prior to the effective date of this	892
section under the common law.	893

(D) In the event of an entry described in division (A) of	894
this section, the financial institution shall not be deemed to be	895
a mortgagor-in-possession of a residential property under any	896
statute or common law. The securing of the residential property	897
including the changing of locks and restricting access shall not	898
be considered as exercising any dominion, control, or the right of	899
either over the property so long as at the time of the entry, an	900
action under this chapter was filed and pending.	901

Section 2. That existing sections 2329.01, 2329.17, 2329.20,	902
2329.26, 2329.27, and 2329.33 of the Revised Code are hereby	903
repealed.	904

Section 3. Chapter 2330. of the Revised Code is intended to	905
provide an alternative basis for filing foreclosures by financial	906
institutions against residential property secured by a residential	907
mortgage. Because this alternative statutory procedure is intended	908
to expedite the foreclosure of unoccupied, often blighted,	909
residential property by providing a more expedited procedure than	910
that afforded by other available foreclosure actions, Chapter	911
2330. of the Revised Code shall be known as the Private	912
Foreclosure Fast-Track Law.	913