Euer bill extending foreclosure mediation clears Senate hurdle

A state law to limit foreclosures for struggling homeowners has cleared a hurdle.

The Senate passed a bill to remove the sunset provision from the so-called Residential Mortgage Foreclosure Act, which was scheduled to take effect in July. If passed by the House and signed by the governor, the provision would be extended through fiscal year 2022-23.

The measure was sponsored by Jamestown’s state senator, Dawn Euer, and unanimously endorsed by the town councilors during their March 19 meeting. Rep. Deb Ruggiero, Jamestown’s delegate in the House, also supports the measure. The bill currently is being considered by the House Finance Committee, of which Ruggiero is a member.


The law mandates a “good-faith effort” between a homeowner and lender “to deal honestly and fairly with the mediation coordinator with an intent to determine whether an alternative to foreclosure is economically feasible.” The mediator, who must be from a counseling agency approved by the U.S. Department of Housing and Urban Development, serves as an “unbiased, impartial and independent coordinator” between the two sides.

According to Rhode Island Housing, which administers the program, more than 70 percent of homeowners who have taken advantage of mediation have been able to reach an agreement that allows them to stay in their homes.

The sunset clause was added because legislators hoped the economy would bounce back stronger by now. The Jamestown resolution, however, says “while foreclosure rates have improved since the depths of economic crisis, the percentage of Rhode Islanders facing foreclosure today is still four times higher than pre-crisis rates.”

Before the law took effect, Rhode Island had one of the least restrictive foreclosure procedures in the country. Lenders merely were required to provide notice to the homeowner of their intent to initiate foreclosure. They also had to post public notice of the foreclosure in a newspaper. There was no required court involvement and no requirement that lenders meet with borrowers to explore alternatives to foreclosure.