South Carolina General Assembly
118th Session, 2009-2010
H. 3846
STATUS INFORMATION
General Bill
Sponsors: Rep. Sellers
Document Path: l:\council\bills\swb\5730mm09.docx
Introduced in the House on April 1, 2009
Currently residing in the House Committee on Judiciary
Summary: Repossession procedures
HISTORY OF LEGISLATIVE ACTIONS
Date Body Action Description with journal page number
4/1/2009 House Introduced and read first time HJ-69
4/1/2009 House Referred to Committee on Judiciary HJ-69
VERSIONS OF THIS BILL
4/1/2009
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9 A BILL
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11 TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA,
12 1976, BY ADDING ARTICLE 6 TO CHAPTER 23, TITLE 37
13 SO AS TO PROVIDE FOR MANUFACTURED HOUSING
14 LOAN DEFAULT AND REPOSSESSION PROCEDURES
15 INCLUDING DEFINITIONS, NOTICE REQUIREMENTS,
16 COURT ORDERS, CURE OF DEFAULT, VOLUNTARY AND
17 INVOLUNTARY REPOSSESSION, AND REINSTATEMENT
18 OF THE LOAN.
19
20 Be it enacted by the General Assembly of the State of South
21 Carolina:
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23 SECTION 1. Chapter 23, Title 37 of the 1976 Code is amended
24 by adding:
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26 “Article 6
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28 Manufactured Housing Loan Default and Repossession Procedures
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30 Section 37-23-110. The terms used in this article have the
31 meanings given them in this article, in this chapter, and in the
32 Uniform Commercial Code as adopted in Title 36, except that for
33 purposes of this article only, „manufactured home‟ means a
34 manufactured home that is located in this State, that is subject to a
35 security interest or other valid encumbrance, and that is the
36 principal residence of the manufactured home‟s occupant and,
37 when used in Section 37-23-120(B), the term also includes a
38 manufactured home that is not the principal residence of the
39 occupant.
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41 Section 37-23-120. (A) To the extent that the procedures
42 established by this article differ from the procedures established or
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1 authorized for repossession of a manufactured home pursuant to
2 the Uniform Commercial Code of this State, the provisions of this
3 article supersede that code and govern the repossession of the
4 manufactured home. The procedures established by this article
5 must be satisfied before a secured party may take any action
6 pursuant to Chapter 69, Title 15.
7 (B) Affixing a manufactured home to real estate does not
8 extinguish an otherwise valid security interest in the home. A
9 manufactured home that is affixed to real estate while not
10 encumbered by a valid security interest must be treated as an
11 improvement to real estate and this article does not apply to it. If
12 real estate to which an unencumbered manufactured home has
13 been affixed as an improvement is subject to proceedings pursuant
14 to Chapter 67, Title 15 or another process to recover real property,
15 the presence of the home on the real estate does not necessitate
16 changed or additional procedures.
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18 Section 37-23-130. (A) When a default occurs under the terms
19 of a security agreement covering a manufactured home as
20 collateral, and the secured party desires to repossess the
21 manufactured home, the secured party may commence the
22 repossession only in a manner authorized by this article.
23 (B)(1) A secured party may commence repossession of a
24 manufactured home by personally serving upon, or by sending by
25 certified or registered United States mail and concurrently sending
26 a copy of the notice by first class mail to, the occupant of the
27 manufactured home a notice and, if the occupant is not the debtor,
28 by sending a registered or certified letter to the last known address
29 of the debtor under the security agreement, both setting forth the
30 circumstances constituting the default under the security agreement
31 and stating that the secured party, at the expiration of a thirty-day
32 period following receipt of the notice, shall seek a court order
33 removing the occupant from the manufactured home and
34 repossessing the manufactured home, unless the debtor or the
35 occupant acting on behalf of the debtor cures the default before
36 that time and in the manner provided by Section 37-23-150. If
37 notice is mailed to a debtor in accordance with this subdivision, the
38 secured party by affidavit shall set forth the circumstances causing
39 the secured party to believe that the debtor could be reached at the
40 address to which the notice was mailed. The affidavit shall state
41 that the secured party has no reliable information causing the
42 secured party to conclude that the debtor might receive mailed
43 notice at another address.
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1 (2) The notice must state: „Your loan is currently in default.
2 Contact us immediately at [insert phone number] to discuss
3 possible options for preventing repossession. We encourage you to
4 seek assistance from the foreclosure prevention counseling
5 program in your area. Nearby community agencies will answer
6 your questions, offer free advice, and help you create a plan. You
7 may contact the South Carolina Department of Consumer Affairs
8 Office at 1-800-922-1594 or www.scconsumer.gov to get the
9 phone number and location of the nearest foreclosure prevention
10 organization. Call today. Waiting limits your options. IF YOU
11 DO NOT BECOME CURRENT ON YOUR LOAN WITHIN
12 THIRTY DAYS, WE WILL SEEK A COURT ORDER
13 REPOSSESSING THE HOME, AND BY COURT ORDER YOU
14 WILL HAVE TO VACATE THE HOME.‟
15 (3) If the debtor does not sign for the registered or certified
16 letter containing the notice within seven calendar days of the first
17 attempted delivery, the secured party may proceed with all
18 permissible actions provided in law as though the debtor‟s
19 signature has been secured.
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21 Section 37-23-140. Except in cases of voluntary repossession
22 as provided in Section 37-23-180, upon expiration of the thirty-day
23 period specified in the notices required by Section 37-23-130 a
24 secured party must apply to the circuit court in the county in which
25 the manufactured home is located for an order directing the seizure
26 and delivery of the manufactured home. The application must be
27 accompanied by a copy of the security agreement entitling the
28 secured party to repossession of the manufactured home, a copy of
29 the notices required pursuant to Sections 37-23-130 and
30 37-23-160, and an affidavit of service stating that those notices
31 were properly served upon the occupant and, if the occupant of the
32 home is not the debtor, the debtor. The notices do not satisfy any
33 of the notice requirements pursuant to Chapter 69, Title 15.
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35 Section 37-23-150. A debtor, or an occupant of a
36 manufactured home acting on behalf of a debtor, within the
37 thirty-day period specified in the notices required by Section
38 37-23-130, may cure a default by tendering full payment of the
39 sums then in arrears under the terms of the security agreement, or
40 by otherwise remedying the default, and by paying the reasonable
41 costs, not to exceed the sum of one hundred dollars, incurred by
42 the secured party to enforce the security agreement. Cure of a
43 default in accordance with the provisions of this section suspends
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1 the secured party‟s right to seek repossession of the manufactured
2 home pursuant the provisions of this article.
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4 Section 37-23-160. (A)(1) If the debtor does not cure the
5 default within the thirty-day period specified in Section 37-23-150,
6 the secured party must send a registered or certified letter and
7 concurrently send a copy of the notice by first class mail to the
8 occupant of the home and, if the debtor is different from the
9 occupant, to the debtor, stating that the debtor has thirty days to
10 reinstate the loan by paying the defaulted amount plus additional
11 allowable fees incurred by the secured party in order to regain
12 possession of the home.
13 (2) If the debtor does not sign for the registered or certified
14 letter containing the notice within seven calendar days of the first
15 attempted delivery, the secured party may proceed with all
16 permissible actions provided by law as though the debtor‟s
17 signature had been secured.
18 (B)(1) The notice must contain, at a minimum, the:
19 (a) name of the secured party, the debtor, each current
20 assignee of the loan, if any, and the original or maximum principal
21 amount secured by the loan;
22 (b) date of the loan;
23 (c) amount in arrears on the loan as of the date of the
24 notice;
25 (d) description of the manufactured home upon which the
26 loan is secured, conforming substantially to that contained in the
27 loan documents; and
28 (e) amount of allowable fees incurred by the secured party
29 in order to regain possession of the home prior to the court order.
30 (2) The notice also must state: „Your manufactured home is
31 currently being repossessed. Contact us immediately at [insert
32 phone number] to discuss possible options for reinstating your
33 loan. We encourage you to seek counseling with the foreclosure
34 prevention counselor in your area. Nearby community agencies
35 will answer your questions, offer free advice, and help you create a
36 plan. You can contact the South Carolina Department of Consumer
37 Affairs Office at 1-800-922-1594 or www.scconsumer.gov to get
38 the phone number and location of the nearest counseling
39 organization. Call today. Waiting limits your options. IF YOU
40 DO NOT BECOME CURRENT ON YOUR LOAN WITHIN
41 THIRTY DAYS, INCLUDING ANY ADDITIONAL FEES, YOU
42 NO LONGER WILL BE ENTITLED TO REINSTATE YOUR
43 LOAN. WE ARE SEEKING A COURT ORDER
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1 REPOSSESSING THE HOME, AND BY COURT ORDER YOU
2 WILL HAVE TO VACATE THE HOME.‟
3 (C) At any time after the expiration of the thirty-day period
4 required pursuant to Section 37-23-130, the creditor may proceed
5 with a court action pursuant to Section 37-23-140, so long as the
6 right to reinstate has not been exercised. The exercise of the right
7 to reinstatement in accordance with the provisions of this section
8 suspends the secured party‟s right to seek repossession of the
9 manufactured home pursuant to the provisions of this article and
10 immediately terminates any court action filed pursuant to this
11 article or Chapter 69, Title 15.
12 (D) For the purposes of this section, allowable costs that may
13 be recovered include insurance; delinquent taxes upon the
14 premises; interest to date of payment; cost of services of process or
15 notices; filing fees; attorney fees not to exceed one hundred fifty
16 dollars and other lawful disbursements necessarily incurred in
17 connection with the proceedings by the party repossessing.
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19 Section 37-23-170. A secured party, in the manner provided
20 by the Uniform Commercial Code of this State, shall record a
21 certified copy of the court order returning possession of a
22 manufactured home to the secured party to perfect title to the
23 manufactured home in the secured party, except in cases of
24 voluntary repossession.
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26 Section 37-23-180. The secured party and the debtor and
27 occupant, if the debtor is not the occupant, may agree in writing on
28 a voluntary surrender of the title and possession of the
29 manufactured home to the secured party before or after the end of
30 the thirty-day period specified in Section 37-23-130. The secured
31 party may file the agreement and other documents necessary to
32 transfer the title in the manner required by law. If this provision is
33 exercised, notice pursuant to Section 37-23-130(B), is not
34 applicable.”
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36 SECTION 2. This act takes effect upon approval by the Governor.
37 ----XX----
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