                                 CODE OF VIRGINIA

PROHIBITED PRACTICES; FORECLOSURE RESCUE (§ 59.1-200.1)

A. In addition to the provisions of § 59.1-200, the following fraudulent acts
or practices committed by a supplier, as defined in § 59.1-198, in a consumer
transaction involving residential real property owned and occupied as the
primary dwelling unit of the owner, are prohibited:

   1. The supplier of service to avoid or prevent foreclosure charges or receives
   a fee (i) prior to the full and complete performance of the services it has
   agreed to perform, if the transaction does not involve the sale or transfer of
   residential real property, or (ii) prior to the settlement on the sale or
   transfer of residential real property, if the transaction involves the sale or
   transfer of such residential real property;

   2. The supplier of such services (i) fails to make payments under the mortgage
   or deed of trust that is a lien on such residential real property as the
   payments become due, where the supplier has agreed to do so, regardless of
   whether the purchaser is obligated on the loan, and (ii) applies rents
   received from such dwellings for his own use;

   3. The supplier of such services represents to the seller of such residential
   real property that the seller has an option to repurchase such residential
   real property, after the supplier of such services takes legal or equitable
   title to such residential real property, unless there is a written contract
   providing such option to repurchase on terms and at a price stated in such
   contract; or

   4. The supplier advertises or offers such services as are prohibited by this
   section.

B. This section shall not apply to any mortgage lender or servicer regularly
engaged in making or servicing mortgage loans that is subject to the supervisory
authority of the State Corporation Commission, a comparable regulatory authority
of another state, or a federal banking agency.

C. In connection with any consumer transaction covered by subsection A, any
provision in an agreement between the supplier of such services and the owner of
such residential real property that requires the owner to submit to mandatory
arbitration shall be null and void, and notwithstanding any such provisions, the
owner of such residential real property shall have the rights and remedies under
this chapter.

HISTORY: 2008, c. 485; 2009, cc. 203, 272.