Current through Register Vol. 63, No. 9, September 1, 2024
(1) All
transactions exempt under ORS
59.035(7),
involving a mortgage banker or mortgage broker must comply with the provisions
of OAR 441-870-0050.
(2) All transactions exempt under ORS
59.035(7),
involving a broker-dealer or person described in 59.015(1)(b) must comply with
the provisions of this rule. Compliance does not relieve any person of any
other duties and liabilities under the Oregon Securities Law, Oregon
Administrative Rules, or any other provision of law.
(3) For transactions to be exempt under ORS
59.035(7), a
broker-dealer or person described in 59.015(1)(b) must provide to the
purchaser, prior to the time of sale, a written disclosure document containing
the following information:
(a) The legal
description of the real property underlying the real estate paper being
sold;
(b) The priority of the lien
created by the real estate paper and the total face amount of any senior liens
including outstanding taxes; or a current title report on the real property
prepared by a title insurance company;
(c) The terms of any senior lien and of any
assignments thereof, or a copy of the instrument creating the senior lien and
any assignments thereof;
(d) A
statement whether any future advances may have a priority senior to that of the
lien created by the real estate paper being sold;
(e) In the case of a sale of junior real
estate paper, a statement of the risk of loss on foreclosure of a senior
lien;
(f) A prominent statement of
any balloon payments, including the dates payable and the amounts
due;
(g) A statement of the balance
of all taxes owing on the real property underlying the real estate paper, as
provided by the county assessor directly or indirectly through a title
insurance company;
(h) A statement
of the value of the real property underlying the real estate paper, based upon
the tax assessed value of the property underlying the real estate paper, as
provided by the county assessor directly or indirectly through a title
insurance company, and:
(A) If available, a
statement of value based upon an appraisal or an opinion of value prepared by
an independent licensed appraiser may also be provided; however
(B) Under no circumstances may the statement
of value be based upon any source other than the county assessor or an
independent licensed appraiser.
(i) If the transaction involves existing real
estate paper:
(A) The debtor's payment record
for the lesser of two years immediately preceding the sale or for the period of
existence of the real estate paper, covering the existing real estate paper
being sold; and
(B) If the payment
record is less than two years, or the real estate paper being sold is a junior
lien, a credit report on the debtor prepared by a credit reporting agency and
current within 90 days of the transaction.
(j) If the transaction involves real estate
paper to be created:
(A) The debtor's payment
record, if any, for the lesser of two years immediately preceding the sale or
for the period of existence of the real estate paper, covering:
(i) Any lien senior to the real estate paper
being created; and
(ii) Any lien
being retired with the proceeds from the subject sale.
(B) A credit report on the debtor prepared by
a credit reporting agency and current within 90 days of the transaction; and
(C) A financial statement of the
debtor current within 90 days of the transaction.
(k) If the seller of the real estate paper,
the seller's agent, or any affiliate is the debtor, a statement disclosing that
fact and the amount of cash paid to the debtor in consideration for the
issuance of the real estate paper;
(l) A statement of any commissions,
collection fees, and other costs chargeable to the purchaser of the real estate
paper; and
(m) A statement of
whether the purchaser of the real estate paper will be insured against casualty
loss.
(4) The
information contained in the written disclosure document described in section
(3) of this rule may be provided in summary form except that copies of the tax
statement and the appraisal, where applicable, must be true and complete copies
of the originals.
(5) Although not
a condition of the availability of the exemption granted pursuant to ORS
59.035(7), all
broker-dealers relying on the exemption and this rule shall, pursuant to ORS
59.195, maintain and make
available to the Director, or any purchaser involved in the subject
transaction, a separate file for each transaction. Each file shall be retained
for a period of six years following the date of the transaction, and shall
include:
(a) A copy of the disclosure
document described in section (3) of this rule;
(b) A written statement, signed and dated by
the purchaser, acknowledging receipt of the written disclosure document and an
opportunity to review the supporting documentation;
(c) The supporting documentation evidencing
the summarized information contained in the disclosure document; and
(d) Copies of the documents described in
section (6) of this rule.
(6) The broker-dealer or person described in
ORS 59.015(1)(b)
must:
(a) Deliver to the purchaser or licensed
escrow agent or title company the written evidence of the obligation properly
endorsed, together with the instrument creating the purchaser's lien or
assessment of the lien;
(b) Record,
or cause to have recorded, the instrument creating the purchaser's lien or
assignment of the lien in a timely manner in the county or counties where the
property is located and retain a copy of the recorded instrument in the
purchaser's transaction file; and
(c) If a title report prepared by a title
insurance company is relied upon for the disclosure required under subsection
(3)(b) of this rule, deliver to the purchaser a fully paid title insurance
policy running to the benefit of the purchaser.
(7) If a security transaction is exempt under
ORS 59.035(7), the
following are also exempt:
(a) Guarantees or
surety agreements created as an integral part of the real estate paper and sold
with the real estate paper if the guarantor or surety is not a mortgage banker,
mortgage broker, broker-dealer, or person described in ORS
59.015(1)(b);
and
(b) "With-recourse" agreements
or guarantees created by a seller and sold with the real estate paper, if the
seller is not a mortgage banker, mortgage broker, broker-dealer, or person
described in ORS 59.015(1)(b).
Stat. Auth.: ORS
59.035(7),
59.045(1),
59.045(2) &
59.350(2)
Stats. Implemented: ORS
59.035(7),
59.045 &
59.350(2)
