FORECLOSED AND DEEDED PROPERTY
Foreclosed and Deeded Property
(1) When properties acquired under ORS 407.135 and 407.145(1) are being sold pursuant to the provisions of ORS 407.375, the sale will be under the following terms:
(a) Must be offered first by sealed bid.
(b) Must be advertised in the local newspaper and comply with the following:
(A) Published at least once during the 15 days prior to the bid opening;
(B) Advise prospective buyers that of the bidders who are persons meeting the eligibility requirements under Article XI-A of the Oregon Constitution (eligible veteran), the one who submits the highest bid shall be given the opportunity to purchase the property for the amount of a higher bid submitted by the highest bidder who is not eligible for a veterans loan. In order to be given an opportunity to match a higher bid, a bidder eligible for a loan under Article XI-A of the Oregon Constitution will have a specified time to match highest bid. The matching bid must be made in writing by 5 p.m. on the date and at the place specified in the notification. The matching bid opportunity is only available to a veteran purchasing the property solely in his or her own name, or with a lawful spouse. If the highest bid is not matched by a person eligible for a loan under Article XI-A of the Oregon Constitution, the highest bid will be accepted;
(C) State the minimum bid that will be accepted.
(2) When properties acquired under ORS 407.135 and 407.145(1) are being sold pursuant to the provisions of ORS 407.377, the sale will be under the following terms:
(a) The person with whom the Director of the Oregon Department of Veterans' Affairs ("ODVA" or the "Department") has entered into a personal services contract must post a "for sale" sign on the property; and
(b) The property must be advertised for sale at least once in a newspaper of general circulation in the locality where the property is located.
(3) Interest rate:
(a) The Director will prescribe interest rates for contract sales of ODVA properties. The Director may apply different rates of interest to different contract sales. Factors that the Director may consider in prescribing contract interest rates may include, but are not limited to the following:
(A) The current value of funds;
(B) The projected value of funds;
(C) The solvency of the Department's Loan Program;
(D) The rates' effect on veterans and other purchasers;
(E) Any federal tax law restrictions;
(F) Actual or projected conventional mortgage rates;
(G) The availability of lendable funds;
(H) Actual or projected demand for ODVA properties;
(I) The source(s) of funds; and
(J) Whether or not the purchaser is providing any approved "work equity" as part of the down payment on the contract.
(b) The Director may change the prescribed rates of interest from time to time to reflect changes in the Director's consideration of relevant factors.
(c) The Director will have the prescribed interest rate(s) published in the Department's Tables and Codes Manual. This publication will be available for viewing at the Oregon Department of Veterans' Affairs, 700 Summer Street NE, Salem, Oregon, during regular business hours.
(d) The interest rate on contracts with approved work equity is subject to the provisions of subparagraph (4)(b)(B)(i) of this rule;
(e) After the original purchase from the State of Oregon, each time ownership of the property is transferred to anyone (veteran or nonveteran), other than the surviving spouse, unremarried former spouse, surviving child, or surviving stepchild of the owner, the interest rate from the date of such transfer shall be the same as the then-prevailing interest rate under subsection (3)(a) of this section, or the existing interest rate on the contract, whichever is higher;
(f) The Director may modify the terms of the contract if agreeable to all parties.
(4) Each property will be sold on contract unless the Director finds that in a particular transaction it would be in the best interest of the Department that the property be sold on a Deed of Trust, or for cash. The terms of all sales will be as follows:
(A) The maximum length of the contract will be established by the purchase price, as follows:
(i) $63,000 and over -- 30 years;
(ii) $35,000 -- $62,999.99 -- 25 years;
(iii) $15,000 -- $34,999.99 -- 20 years;
(iv) $10,000 -- $14,999.99 -- 10 years;
(v) Under $10,000 -- 0 years (Cash Out Only)
(B) The Director may enter into a contract with terms different from the ones prescribed in this rule if the provisions of ORS 407.375(6) apply (no satisfactory bid received and sale negotiated).
(b) Down Payment:
(A) The term "purchase price" as used in this rule shall mean the actual purchase price agreed to by the purchaser and the Director;
(B) The Director may accept improvements of the property by the purchaser in lieu of other means of satisfying the down payment requirement, in which case the provisions of ORS 407.375(4) will apply and improvements in lieu of a cash down payment shall be subject to the following conditions and limitations:
(i) The interest rate on such a contract shall be one percent higher than the otherwise applicable contract interest rate in effect at the time of purchase, until the required improvements have been completed, inspected, and a completion letter appropriately issued. After the required improvements have been completed, inspected, and a completion letter has appropriately been issued the Director will lower the interest rate to the otherwise applicable contract interest rate, adjust the payment to reflect the lower rate, and amortize the remaining principal balance within the remaining term of the contract, provided that the purchaser has complied with the occupancy requirements provided by section (9) of this rule. The adjusted payment will be effective on the first day of the second full month following the Director's written approval of the completed improvements;
(ii) Improvements in lieu of a cash down payment will not be allowed unless the contract purchaser will occupy the property being purchased as provided by section (9) of this rule;
(iii) Improvements in lieu of a cash down payment will not be allowed unless the value added to the property by completed improvements is $500 or more;
(iv) The Director will not consent to an assignment of the contract until the required improvements have been completed to the sole satisfaction of the Director or payment of what the original down payment would have been at the time of purchase or the new owner of the property signs an agreement agreeing to complete the improvements;
(v) If the purchaser fails to complete all of the improvements within the time allowed by the Director or fails to make the property available for inspection by the Director's representative, the Director will give the purchaser 30 days notice to either complete all of the improvements or to pay a cash down payment. The down payment will be the amount the purchaser would have been required to pay if the property had been purchased without approved work equity. The Director will not give any allowance for completion of a portion of the improvements. If purchaser elects to make a cash down payment in lieu of completing improvements, the Director will lower the interest rate one percent to the base contract interest rate at the time of purchase, reamortize the remaining principal balance on the account, and adjust the principal and interest portion of the regular payment accordingly. Failure to complete all of the improvements or pay a cash down payment will constitute a default under the terms of the Contract of Sale. Thereafter, the Director may exercise any or all of the default remedies stated in the contract.
(C) The minimum down payment required will be established by whether the property will be owner-occupied, whether the property is classified as farm, residential, personal property, unique, unusual, or bare land, the asking price and the purchase price, as follows:
(i) Residential -- Asking price less than $80,000 -- Five percent down payment if owner-occupied, otherwise 15 percent down payment. In cases where the purchase price is different than the asking price, the percentage (five or 15) will be applied to the purchase price;
(ii) Farm, Mobile Home With Land, Bare Land, Residential -- Asking price $80,000 or more -- 10 percent down payment if owner-occupied, otherwise 20 percent down payment. In cases where the purchase price is different than the asking price, the percentage (10 or 20) will be applied to the purchase price;
(iii) Personal Property Mobile Home or Floating Home -- 20 percent down payment if owner-occupied, otherwise 30 percent down payment;
(iv) Unique or Unusual Property -- The required down payment will be stated on the property description sheet in an amount or percentage determined by the Director.
(5) A purchase of property from the Oregon Department of Veterans' Affairs will not be considered a loan under ORS 407.205.
(6) All purchasers must meet the department's repayment ability requirements.
(7) If a prospective purchaser submits more than one bid for the same property, only the highest such bid will be considered.
(8) The property will not be sold on contract to anyone who had an interest in the property at the time foreclosure action was commenced or a deed-in-lieu of foreclosure was accepted.
(9) A purchaser who states that he or she will be occupying the property in order to pay a lesser percentage of down payment or to receive approval of work equity must:
(a) Occupy the property within 60 days after the sale closes; and
(b) Continuously occupy the property as his or her principal primary residence for a period of not less than 365 days from the date of closing or initial occupancy, whichever is later.
(10) In the event purchaser fails to occupy the property as stated, the Director may require cash payment of an additional down payment. The required additional down payment will be the amount the purchaser would have been required to pay if the property had been purchased as nonowner-occupied, less any cash down payment received at closing. If work equity improvements were approved, the Director will not give any allowance for completion of all or any portion of the improvements. Following payment of the required additional down payment, the department will reamortize the remaining principal balance on the account and adjust the principal and interest portion of the regular payment accordingly.
Stat. Auth.: ORS 406.030, 407.115, 407.135, 407.145, 407.375 & 407.377
Stats. Implemented: ORS 407.135, 407.145, 407.375 & 407.377
Hist.: DVA 8-1982(Temp), f. & ef. 4-6-82; DVA 13-1982, f. & ef. 5-17-82; DVA 7-1983, f. 5-13-83, ef. 5-15-83; DVA 14-1983, f. 11-29-83, ef. 12-1-83; DVA 5-1984(Temp), f. & ef. 7-17-84; DVA 1-1985, f. & ef. 1-15-85; DVA 6-1985, f. 5-22-85, ef. 7-1-85; DVA 11-1985, f. & ef. 11-5-85; DVA 4-1987, f. & ef. 5-1-87; DVA 7-1987, f. 9-30-87, ef. 10-1-87; DVA 5-1990, f. 8-20-90, cert. ef. 10-1-90; DVA 2-1991, f. 5-29-91, cert. ef. 6-3-91; DVA 3-1996, f. 6-21-96, cert. ef. 6-22-96; DVA 9-2002(Temp), f. 10-30-02, cert. ef. 11-1-02 thru 4-29-03; DVA 5-2003, f. & cert. ef. 4-23-03; DVA 3-2005, f. & cert. ef. 4-22-05
Escrow Closings of Contract Sales
Effective with offers accepted by the Director after June 30, 1988:
(1) All contract sales of real or personal property by the Director of Veterans' Affairs shall be closed by a person or firm licensed as an escrow agent under the Oregon Escrow Law (ORS 696.505 to 696.590) or an attorney at law rendering services in the performance of duties as attorney at law.
(2) The escrow agent or attorney shall be selected by the purchaser.
(3) The costs of the escrow closing shall be shared as follows:
(a) The Director of Veterans' Affairs will pay one-half of the escrow agent's fee;
(b) The purchaser will pay one-half of the escrow agent's fee;
(c) Any other closing costs will be paid by the purchaser unless otherwise agreed by the parties.
(4) The requirement for licensed escrow (or attorney) closing shall not be waived except when in the Director's opinion, requiring such closing would cause an undue hardship.
Stat. Auth.: ORS 406 & 407
Stats. Implemented: ORS 407.165 & 407.169
Hist.: DVA 2-1984, f. & ef. 5-3-84; DVA 2-1988, f. 6-6-88, cert. ef. 6-30-88; DVA 3-2007, f. & cert. ef. 9-25-07
Mineral Rights and Geothermal Resource Rights
(1) As used in this rule "mineral" means oil, gas, sulfur, coal, gold, silver, copper, lead, cinnabar, iron, manganese and other metallic ore, and any other solid, liquid or gaseous material or substance excavated or otherwise developed for commercial, industrial or construction use from natural deposits, including mineral waters of all kinds. (This is the same definition as used in ORS 273.775.) As used in this rule "mineral" includes sand and gravel.
(2) As used in this rule "geothermal resource" means the natural heat of the earth, the energy, in whatever form below the surface of the earth present in, resulting from, or created by, or which may be extracted from, the natural heat, and all minerals in solution or other products obtained from naturally heated fluids, brines, associated gases, and steam, in whatever form, found below the surface of the earth, exclusive of helium or of oil, hydrocarbon gas or other hydrocarbon substances, but including, specifically:
(a) All products of geothermal processes, embracing indigenous steam, hot water and hot brines;
(b) Steam and other gases, hot water and hot brines resulting from water, gas, or other fluids artificially introduced into geothermal formations;
(c) Heat or other associated energy found in geothermal formations; and
(d) Any by-product derived from them. (This is the same definition as used in ORS 522.005.)
(3) The Director of the Oregon Department of Veterans' Affairs (ODVA) may sell, retain, assign, lease, release, develop, market or otherwise administer any mineral rights and geothermal resource rights obtained by ODVA after January 1974 pursuant to ORS 88.720, 406.050, 407.135, or 407.145(1):
(a) Prior to a release or transfer of any interest in mineral or geothermal resource rights pertaining to a property of three acres or more in Clatsop, Columbia, or Washington County, or of 40 acres or more in any other county, ODVA will request a review and recommendation from the Division of State Lands (DSL) regarding the potential for the occurrence of mineral or geothermal resources with value, excluding soil, clay, stone, sand and gravel. ODVA may, but shall not be required to, request a similar review and recommendation from DSL with respect to mineral or geothermal resource rights related to properties of lesser size. In any situation where additional professional services may be required by ODVA, the services shall be provided at the expense of the applicant for the release. ODVA may then, at the director's discretion, administer such rights consistent with this section in any manner that the director determines will advance the interests of the Oregon War Veterans' Fund, including the release by ODVA of all or part of such rights of the related property upon application and payment of the appropriate application fee together with such other consideration, required by ODVA;
(b) An application for any interest in mineral or geothermal resource rights held by ODVA must be completed and submitted directly to ODVA together with the documents and other information listed on the application form or otherwise required by ODVA, together with the appropriate application fee. Any or all of the application fee may be waived by ODVA if such waiver is determined by it to be in the economic interest of ODVA, or if ODVA determines that it would avoid undue hardship.
(4) Upon advice from DSL concerning potential mineral or geothermal resources, ODVA may change the acreage review for any county in Oregon at any time by administrative rule.
(5) Two years after the effective date of this rule, and each biennium thereafter, ODVA and DSL will review the rule and its effects for possible changes.
Stat. Auth.: ORS 88.720, 273.775, 406.030, 406.050, 407.115, 407.135 & 407.145
Stats. Implemented: ORS 88.720, 273.775, 273.785, 407.135 & 407.145
Hist.: DVA 6-1991(Temp), f. 9-25-91, cert. ef. 9-26-91; DVA 3-1992, f. & cert. ef. 3-23-92; DVA 3-1996, f. 6-21-96, cert. ef. 6-22-96
Forcible Entry and Wrongful Detainer
Pursuant to ORS 105.130(5), in any action brought by the State of Oregon by and through the Director of Veterans' Affairs, pursuant to the provisions of ORS 105.105 to 105.168, to recover the possession of premises to which the Director of Veterans' Affairs is entitled, any officer or employee of the Department of Veterans' Affairs is authorized, on behalf of the Director of Veterans' Affairs, to:
(1) File the complaint; and
(2) Appear in District Court or Justice Court at the first appearance referred to in ORS 105.137, provided that the Attorney General has given written consent to such appearances.
Stat. Auth.: ORS 105.130(5), 406.030 & 407.115
Stats. Implemented: ORS 407.115, 407.135 & 407.145
Hist.: DVA 5-1992, f. & cert. ef. 4-2-92; DVA 3-2007, f. & cert. ef. 9-25-07
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