2013 Indiana Legal Updates

Indiana Legislation, 2013

As a leading creditors’ rights firm practicing in the states of Indiana, Ohio, Kentucky and West Virginia, we believe it is imperative and dutiful to provide information regarding any statutory, regulatory and Court process changes, or possible changes, that may have implications to you and our firm.

Following you will find some important pieces of legislation regarding property law enacted in Indiana in 2013. Please let us know if you would like to discuss these matters in more detail.

SB 279: Non-named parties in foreclosure actions.
http://www.in.gov/legislative/bills/2013/SE/SE0279.1.html

  • Signed 5/7/2013
  • Eliminates a provision under which certain omitted parties (parties who have an interest in the property subject to a mortgage foreclosure action but who are not named in the foreclosure action) are bound by the court’s judgment in the foreclosure action as if they had been parties to the foreclosure action. (Changes to IC 32-29-8-2)
  • Limits the post-sale redemption rights of certain omitted parties. (Changes to IC 32-29-8-3) There are no post-sale redemption rights for borrowers and this new legislation does not change that.

SB 433: Abandoned property; property safety; mobile homes.
http://www.in.gov/legislative/bills/2013/PDF/SE/SE0433.1.pdf

• Signed 5/8/2013
• Tax Sale Properties – Transfer to Individual.

Establishes a procedure to permit a county executive to transfer certain properties that did not sell at a tax sale to a person able to repair and maintain the properties.

Provides that before the county executive may transfer properties that did not sell at a tax sale to a nonprofit corporation, an abutting property owner, or a person satisfactorily able to repair and maintain the property, a person with a substantial interest in the property must be given an opportunity to redeem the property.

• Tax Sales – Lists.

Requires a county executive, in preparing the list of tax delinquent properties that must be submitted annually to the county auditor, to include on the list any real property that the executive of a city or town located in the county has determined to be abandoned and has identified as such to the county executive.

Requires the county auditor of a county not having a consolidated city to prepare a list of tracts or items of real property within each city or town located in the county for which the fall installment of the most recent previous year’s taxes is delinquent and to give a copy of the list to the appropriate city or town or post the list on the county’s web site.

Requires a county executive to give notice to the executive of a city or town where the subject property is located, when said property is subject to sale or transfer under the statute governing sale or transfer of properties with delinquent taxes or assessments so that the city or town may accept transfer of the property.  

• Removes a requirement that the county executive’s sale of a certain adjacent vacant parcel to an adjoining property owner may be conducted only if construction of a residential dwelling is permitted on the vacant parcel.

• Property Maintenance.

Requires that certain notices concerning demolition and removal under the unsafe building law must be served on each person with a known or recorded substantial property interest.

Authorizes a municipality or county to bring an action to collect unpaid expenses relating to the abatement of high weeds and grass. (Under current law, the municipality or county may obtain only a lien on the property containing the high weeds and grass.)

• Abandoned Property

Amends a statute authorizing judicial determination that real property subject to a mortgage is abandoned so as to authorize a judicial determination under that statute that real property not subject to a mortgage is abandoned.

Provides that a creditor is a person immune from civil liability for entering abandoned real property to perform certain actions to clean up the real property. Provides that removal or painting over of graffiti is an action that is immunized.

Provides that a person who enters or refuses to leave vacant or abandoned property after having been barred from the property by a court order or a law enforcement officer commits criminal trespass.

Provides that for purposes of the statute relating to removal of weeds from properties, notice may be given by first class mail rather than by certified mail.

• Mobile Homes.

Provides that only the owner of a mobile home may obtain the permit required to move the mobile home from one location to another.

Requires a county treasurer to notify the appropriate assessing official of the township to which a mobile home will be moved that a permit to move the mobile home has been issued.

Requires the department of local government finance to develop a system for recording the property tax information for a mobile home that is not assessed as real property.

 Provides that the system must use an identification number that is unique to the vehicle identification number of the mobile home.

Imposes recording requirements upon purchase contracts for a mobile home or manufactured home that is not assessed as real property.

Provides that for assessment dates after December 31, 2013:

(1) a contract buyer claiming the standard deduction with respect to a mobile home or manufactured home that is not assessed as real property while purchasing the mobile home or manufactured home under a contract must show compliance with the new requirements; and

(2) an owner other than a contract buyer must attach a copy of the owner’s title to the mobile home or manufactured home to the application for the deduction.

Specifies that a reference to a manufactured home in the certificate of title law must be construed as a reference to a mobile home.

Provides that mobile home community registers must be open to inspection by township and county assessors.

Specifies the information that must be submitted to the county recorder to have a contract for the sale of a manufactured home or mobile home recorded.

Specifies that any applicable recording fees must be paid.

Requires the county recorder to provide the submitted information to the county treasurer and to notify the appropriate assessing official that such a contract has been recorded.

• Makes certain technical changes.

HB 1084: Various Property Issues.
http://www.in.gov/legislative/bills/2013/HE/HE1084.1.html

  • Signed 5/10/2013
  • Provides that the homeowner protection unit of the attorney general’s office shall enforce violations of the statute concerning homeowners associations.
  • Makes changes to the mortgage rescue protection fraud act to make it consistent with the credit services organization act and the home loan practices act, including providing that the statute of limitations on filing claims runs for five years from the occurrence of the violation and not from the time the home loan is made.
  • Permits suspension of the license of an individual licensed under the real estate licensing law for an emergency period if the licensee has engaged in material and intentional misrepresentations or omissions. (The law currently allows for emergency suspension of the licenses of real estate appraisers only.)
  • With certain exceptions, requires a homeowners association to:
    • (1) make financial records available for inspection upon written request by a member of the association; and
    • (2) provide all communications concerning a dispute with a homeowner to that homeowner.
  • Permits a homeowners association to charge a search fee not to exceed $35 per hour for time spent on records searches in excess of one hour. Provides that the total amount of the fee for a search may not exceed $200.
  • Provides that the homeowners association statute does not abrogate an agreement by a homeowners association to provide additional inspection rights.
  • Requires a clerk of a court who must collect a civil costs fee from a party filing a civil action to also collect a $50 mortgage foreclosure counseling and education fee from a party filing a civil action to foreclose a mortgage. Provides that mortgage foreclosure counseling and education fees collected by a clerk must be deposited in the home ownership education account.
  • Urges the legislative council to establish a study committee on the topic of homeowners associations.

HB 1132: Property matters.
http://www.in.gov/legislative/bills/2013/HE/HE1132.1.html

  • Signed 5/2/2013
  • Allows the resources of the Indianapolis housing trust fund to be used to fund programs considered appropriate to meet housing and community development needs of certain families.
  • Requires a party filing a praecipe for a sheriff’s sale to pay delinquent sewer liens on the property under certain circumstances. (Changes to IC 32-29-7-8.5) Most county sheriffs require all delinquent sewer liens to be paid currently, in order to hold the foreclosure (sheriff) sale.
  • Requires the interim study committee on insurance to study certificates of release of liens on mortgaged property during the 2013 interim.

HB 1145: Various local government matters.
http://www.in.gov/legislative/bills/2013/HE/HE1145.1.html

• Signed 4/29/2013

• Authorizes a political subdivision or municipally owned utility to charge a reasonable fee for convenience when accepting a credit card or bank card for payments. Provides that a convenience fee imposed by a political subdivision or municipally owned utility on a credit card transaction may not exceed $3, must be uniform regardless of the bank card or credit card used, and may be collected regardless of retail merchant agreements between the bank and credit card vendors that may prohibit such fees.

• Provides that unused and unencumbered funds from any fiscal year and certain specified sources may be transferred to a political subdivision’s rainy day fund at any time.

• Provides that unobligated cash balances from any fiscal year and sources not specified by statute may be transferred to the rainy day fund if the amount of the transfer is specified in an ordinance or resolution and the transfer is not more than 10% of the political subdivision’s annual budget.

• Provides that if a town publishes any of its ordinances in book or pamphlet form, no other publication is required in order for the ordinance to take effect. Provides that a town ordinance prescribing a penalty or forfeiture for a violation takes effect two weeks after the publication of the book or pamphlet.

• Requires a redevelopment commission or its designee to file the redevelopment commission’s annual report with the unit’s executive not later than March 15 of each year. (Current law requires the report to be filed within 30 days after the close of the calendar year.)

HB1317: Land Banks.
http://www.in.gov/legislative/bills/2013/HE/HE1317.1.html

• Signed 4/29/2013

• Establishes the land bank study committee, a legislative committee, to study issues relating to the creation of land banks at the municipal level as well as the county level including the following: (1) The effects that municipal land banks and reformed land banking would have on current property tax collection and enforcement and tax sales. (2) The effect the creation of municipal land banks would have on local revenues.

HB 1322: Certificates of Insurance.
http://www.in.gov/legislative/bills/2013/HE/HE1322.1.html

• Signed 4/15/2013

• Specifies requirements related to a certificate of insurance issued in connection with a contract related to property, operations, or risks located in Indiana. (Changes to 27-1-42)

HB 1568: Real property subject to tax sale.
http://www.in.gov/legislative/bills/2013/HE/HE1568.1.html

• Signed 4/29/2013

• In the statute concerning the sale of real property for which taxes or special assessments are delinquent, makes the following changes for purposes of the section that allows a county executive that holds a certificate of sale for a vacant parcel to sell the parcel to a contiguous residential property owner:

(1) Provides that the vacant parcel or the certificate of sale for the vacant parcel will be sold to the successful applicant for $1, plus the amount of certain costs incurred by the county in the sale. (Under current law, the sale price does include costs incurred by the county.)

(2) Provides that for purposes of the section, a “vacant parcel” includes an improved parcel. (Current law provides that a “vacant parcel” includes only an unimproved parcel.)

(3) Specifies that the county executive may offer for sale the vacant parcel or the certificate of sale for a vacant parcel.

(4) Eliminates the property tax exemption for a vacant parcel acquired by a contiguous residential property owner.

(5) Provides that a contiguous residential property owner who receives a tax deed for a vacant parcel may not sell the vacant parcel for 1 year. (Changes to IC 6-1.1-24)

• Establishes an alternative urban homesteading program that provides for the following: (1) That an individual is qualified to receive real property offered under the program if the individual applies for and receives, within a period specified by the local agency administering the program, a rehabilitation loan eligible for insurance under section 203(k) of the National Housing Act. (2) That the conveyance of a dwelling to a qualified individual under the program shall be made for a fee of $1, plus certain costs incurred by the county in obtaining the property. (3) That before the vesting of a fee simple title in a qualified purchaser under the program, any material failure by the purchaser to carry out the agreement required under the program nullifies the agreement and all right, title, and interest in the property reverts to the agency administering the program.

• Provides that a financial institution that holds land that: (1) has been subdivided into lots; or (2) rezoned for, or put to, a different use; qualifies for a land development exception in which the reclassification of the land is delayed.

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