House Keeping Report-
One of the most hotly contested issues in Oregon foreclosure law is whether lenders who do not obtain written assignments of trust deeds can foreclose non-judicially. While other lenders fret about their missing assignments, Freddie Mac has taken a different approach. Freddie instructs servicers to destroy them prior to foreclosure.
In Oregon, a lender can foreclose without going to court only if the lender complies with all requirements in the Trust Deed Act. One of those requirements is that “any assignments of the trust deed by the trustee or the beneficiary” must be publicly recorded before a non-judicial foreclosure is commenced. See ORS 86.735(1).
Some lenders have argued that the phrase “any assignments” means any written assignments, which excludes transfers that occur automatically when a note is transferred. But no lender in Oregon, including Freddie Mac, has argued that written assignments are not “assignments” that have to be recorded.
For all non-MERS trust deeds, Freddie requires the seller to execute and deliver a written trust deed assignment to Freddie at the time of sale. The assignment becomes part of Freddie’s mortgage loan file. But that means there exists at least one written assignment that must be recorded prior to commencing a non-judicial foreclosure in Oregon.
Whether to cut costs or to avoid becoming the public face of so many foreclosures, Freddie created a special rule for Oregon just over 11 years ago. Freddie explained the new rule in a letter issued to all lenders that sell or service Freddie Mac loans. That letter, dated January 18, 2002, has the subject line: “Foreclosing on Properties in the State of Oregon.”
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