Ohio Senate Bill 25 Aims to Reduce Foreclosure Sale Timelines and Costs

Introduced in the Senate on January 23, 2023, and referred to committee on February 8, 2023, Ohio Senate Bill 25, known in short form as the Bill that “regards real property foreclosures,” sponsored by Senator Bob D. Hackett (R), seeks to alter the procedures for foreclosure sales.
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Chapter 2329 of the Ohio Revised Code currently governs execution upon judgments, including sales of real property resulting from foreclosure actions. SB25 proposes four significant changes to the foreclosure sale process that could result in a reduction in the length of time and cost of the foreclosure sale process:

1. While the Revised Code currently permits creditors to motion the court for the use of a private selling officer rather than sale by sheriff, many counties and judges arbitrarily deny these requests. SB25, however, will allow creditors seeking a mortgage foreclosure sale of property to demand the use of a private selling in cases where the debtor has not defended against the foreclosure action. ORC §2329.152.
2. Regardless of whether the auction is conducted by the sheriff or a private selling officer, SB25 also negates the requirement that notice of the sale be published in a newspaper of general circulation in the county in which the property is located. Instead, the manner of advertisement is at the discretion of the seller, and online only advertisement is permissible. ORC §2329.26(2)(a).
3. SB25 reduces the amount of time an online foreclosure auction must run from seven to only three calendar days, regardless of whether that online sale is being conducted by the county sheriff or a private selling officer. ORC §2329.152.
4. The requirement that the real property first be appraised by three disinterested appraisers is eliminated by SB25; instead, the county auditor’s fair market value is to be used to calculate the minimum sale price. ORC §2329.17; ORC §2329.20.

SB25 allows for more control by the creditor over the manner of sale held while reducing the pre-sale appraisal and advertisement requirements that add to foreclosure timelines and costs. Currently under the review of the Ohio Senate Judiciary Committee, SB25 is in its infancy. Proponents of the Bill urge its passage as a means to increase third party purchaser numbers, raise community property values and provide for additional surplus funds at sale, thereby benefiting creditors and the foreclosed borrowers alike.

The text of SB 25 in its current version can be found here.