Widespread Changes in Ohio Foreclosure Procedures
House Bill 138, which changes many of the procedural and substantive aspects of foreclosures in Ohio, was recently signed into law by Governor Strickland and became effective September 11, 2008. Some of the changes — such as the revised lis pendens date — will speed the foreclosure process along, making title examination much easier. Other changes will benefit consumers and title agents, such as the Preliminary Judicial Reports now required for residential foreclosures. Lenders should note, however, that there are a number of pitfalls in this legislation that have the potential to extend foreclosure proceedings, including the potential for court-required mediation at any point during the foreclosure proceedings and the largely unfettered discretion given to courts to stay the confirmation of a judicial sale in order to permit the defaulting property owner the chance to redeem the property. While the changes will benefit title agencies and defaulting consumer borrowers, they will also potentially saddle lenders with additional costs and delays in what is already a costly and time-consuming process.