A new compliance requirement has arisen for Ohio’s banks and credit unions. Under a new Ohio law, lenders must start to send notices to their borrowers before collecting a debt in default if the borrower’s residential real property secures that debt through a junior lien. Unfortunately, that new law is ambiguous, which could impose significant liability on Ohio’s lenders. As a result, they should consult experienced legal counsel to develop compliant forms and policies.
Protecting Ohio’s Lenders During Foreclosure
Foreclosure lawsuits are exacting masters. One mistake, however small, can taint everything that comes after. A few years ago, Aurora Loan Services experienced that first hand when a missed lien extended its foreclosure case by more than three years—a mistake that could’ve cost that lender its collateral.
Courts Can’t Modify Garnishments Without Reason
If you work for an Ohio bank or credit union, you’ve probably tried to garnish a debtor’s wages. If so, you’ve likely run into a court that reduced the amount you can take per pay period. For example, it’s common for some courts to reduce the garnished amount just because the debtor complains—even if Ohio and federal law allow for more. Can Ohio’s courts do this? No, according to the Sixth District Court of Appeals, which recently overruled a Toledo Municipal Court order that reduced a wage garnishment.
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