A Twist of Events for Arizona’s New Anti-Deficiency Law

After realizing that the new anti-deficiency law would have unforeseen consequences, the original sponsor of SB 1271 has asked that the legislation be immediately repealed. When Senator Steve Pierce, an Arizona Republican initially sponsored SB 1271 the objective was to help small community banks in Arizona which did not receive any of the $700 billion dollars in TARP funds to help ease their foreclosure losses. But after the backlash from consumers and lobbyists he feels there would be better ways to help these local banks that would not hurt homeowners facing foreclosure.

While SB 1271 does have provisions that would have protected homeowners who occupied a home for six months it would not protect people who also owned a vacation home or rental property. This would have allowed banks to go after a homeowner’s personal residence if a vacation home or rental property was to be foreclosed upon.

This is a great example of a political leader listening to and working with the people he serves. The Arizona real estate community will continue to work with the Governor’s office and the legislature on this important issue until it is resolved. But right now, Senator Steve Pierce of Arizona deserves an “Atta-boy” for stepping up to the plate on this issue!