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Interior Building
Sub-Committee on Law and Legislation
April 4, 1936.

Mr. Frederic A. Delano
Central Housing Committee
Washington, D. C.
Dear Mr. Delano:


The Sub-Committee on Law and Legislation, having made
an intensive study of existing foreclosure procedure and
costs in the forty-eight States and the District of Columbia, and emergency moratorium legislation in said jurisdictions, as evidenced by the digests of State foreclosure
and moratorium legislation, transmitted herewith and marked
Appendices I and II, now makes a special report to the Central Housing Committee on the "Social and Economic Effects
of Existing Foreclosure Procedure and Emergency Moratorium
Legislation", which is attached hereto.
The digests of State foreclosure ruld moratorium legislation, attached as appendices, have already been forwarded



to each agency for


use of their



Sincerely yours,

/ d/
/?V"~-(../. k-<4.A.e,~'
Horace Russell



CRC 52870 1&L No.1 of 6





Central Housing Committee
by its
Sub-Committee on Law and Legislation
April 2, 1936.

CHC 52870 L&L No.2 of 6
Differences in the Relative Rights of Debtors and Creditors under State
For..£lcl.9sure Law~_
Our study of the foreclosure and moratorium laws in the various
states reveals differences which have a decided effect upon the relative
rights of mortgagors and mortgagees in the different sections of our
country. In some jurisdictions the laws require complicated and
expensive foreclosure proceedings before the property can be brought to
sale; a:1d in others they proviJ.e long redemption periods after foreclosure sale before possession and a clear title can be acquired by the
lender or other successful bidder. On the other hand, the laws of some
states permit quick foreclosures by unregulated power of sale with no
It is obvious that in these latter jurisdictions the rights
of a mortgage borrower, after a default in the performance of his obligations lL.der the mortgage, are relatively less than in those jurisdictions
where foreclosure proceedings are complicated and expensive, or where a
period of redemption must elapse before the borrower's rights in the
mortgaged property can be finally terminated.
Diversity of Foreclosure Procedure
A seneral survey indicates that in twenty-eight states foreclosure
is by action in court. Ten states use unregulated power of sale. Five
states use regulated power of sale, and the remaining states have various
other methods. Thi rty-one states provide a redemption period ranging from
four nmnths in Oregon to two years in Alabama. Seventeen states have no
redemption period, but, of these, eight use foreclosure in court which
requires months to complete.


Eqonomic Justice of Moratorium Legislation

Twenty-three states have some form of moratorium legislation, which
usually takes the form of postponing the foreclosure, extending the redemption ~)eriod, or abolishing or limiting the right to deficiency judgments. T2lere is no question but that such emergency laws have arisen
because deuressed economic conditions urevailing throughout the C01ll1try
greatly increased the number of mortsagors who were unable to fulfill
their contracts. These laws may be re§arded as llaving been enacted on
the following social and economic basis.

Ul1restricted foreclosure of farm and home mortgages under the
circmnstances prevailing at the time when the moratorium laws were
initiated. w01J~d have de:'Jrived large numbers of persons of essential shelter
and protection, and would have left them without the necessary means for
earning a living. Such wholesale evictions migpt have seriously endangered
basic interests of society. Not only was there the possibility that a
large class of dispossessed persons might have been created unable to make

CEC 52870 1&1 No.3 of 6
their oun way in society, but there was also the possibility that the
security value of real estate might have been permanently impaired
througl1 the continuance of depression conditions. To meet this emergency
situation the moratorium laws were passed.
Hearly all moratorium statutes expressly provide that the income obtained from the property during the 1?eriod while the mortgagor holds possession, or the fair value of the rental whiCh might have been obtained
for it, shall be turned over to the mortgagee or used for the payment of
taxes and upkeep on the mortgaged property_ In this way a compensation is
afforded the mortgagee for the enforced suspension of his right to foreclose.
Moratorium legislation has been a product of depression conditions.
It has been justified by the courts on the ground that in an emergency, such
as that created by the depression, the legislature may authorize a reasonable
moratorium to protect the vital interests of the community. Accordingly it
is to be e):pected that such legislation will disappear wi til the passing of the
emergency which called it into being.
Dealings in Mql'tga~
closure ~~islation

Cred~ t



and Uneconomic Fore-

Of t..'l1e more permanent foreclosure laws, the extreme diversity itself
undoubtedly has some tendency to retard and limit interstate dealings in
mortgage securities. The hazards and administrative eA~ense of large insurance companies and other mortgage loan institutions operating on a national basis are necessarily increased by wide variations in the rights and
remedies incident to foreclosure, regardless of the advantages or disadvantages under the laws of any particular state.
However, the more important effects of state foreclosure laws in retarding interstate dealings in mortgage credit, and intrastate dealings as
well, are to be found in those instances where the enforcement of the debt
against tile security involves burdensome conditions and long delays for the
lender, or where the process of foreclosure entails excessive hazards and
risks for the borrower. Statutes which provide a lengthy, expensive, complicated or otherwise burdensome foreclosure procedure, or which interpose a
long period of redemption before title and possession to the mortgaged property can be obtained, have a tendency to increase interest rates and security requirements throughout the jurisdiction, since prospective lenders
naturally take into account the procedure available for realizing the debt
out of the security when determining the conditions on which they will be
willing to make loans. If, on the other hand, the notice requisite for a
foreclosul'e sale in a particular jurisdiction is not such as to give the
mortgagor a reasonable opportunity to be present at the sale and to protect
his equity by bidding, or if foreclosure otherwise subjects the mortgagor
to hazards and risks which are unnecessary for the protection of the mortgagee, pn:dent landowners may be expected to abstain from borrowing on mortgage secUl'i ty except in cases of absolute neoessi ty.

CHC 52870 1&L No.4 of 6

Greate~~ Diver~;ty

in Foreclosure Law Found in Provision for Period

of Re@l!lPtion
Tne feature of mortgage and foreclosure law which has perhaps the
widest variation and the most direct effect on the rights of the parties
is that dealing with redemption by the mortgagor. It is the essence of
every mortgage that, upon payment of the debt to the mortgagee in compliance with its terms, the title to the ~roperty will remain indefeasible in, or will revert to, the mortg8.gor or his assigns. This distin6uishos a mortgage from a sale. If the mortgagor does not pay the debt
on the day fixed it is clear that the lender should not be compelled to
wai t more than a reasonable ti:l1e before receiving payment or title to
the p1'0"gerty in lieu thereof. It is also clear that sufficient advance
notice of the sale of the -property must be given the mortgagor and the
general public if there is to be competitive bidding at the foreclosure
sale. The foreclosure statutes in force in many states are framed on
the !)ri:nci}11e that the mortgagee should give adequate notice and that
the borrower should. have a reasonable time in which to pay the debt before losing his property. However, the various interpretations of what
constitutes a reasonable time and the diversity of the means used for
obtaining it complicate the ~roblem.
There is a clear distinction between the equity of redemption and
a statutory right of redem~tion after foreclosure. The equity of redemption is that interest in the land which is held by the mortgagor
before foreclosure, while the ri&lt of redemption is not an interest but
a mere personal privilege given by the statute to the mortgagor after
the lo.nd has been sold.
Some states prolong the equity of redemption by reqlllnng that a
certain time elapse between the commencement of foreclosure proceedings
and tile sale thereunder. In Indiana, this period is one year and replaces the old right of redemption after foreclosure in that state. It
has been contended that a right of redemption after foreclosure is undesirable because of its tendency to decrease bidding at sales, since
the purchaser1s title is inferior to the mortgagor's right of redemption.
There ap~ears to be considerable force to this argument when value and
market conditions are such as to attract purchasers generally.
In a majority of those states where a period of redemption has been
provided the legislature has chosen, however, to create a right of redemption after foreclosure, rather than to prolong the equity of redemption before sale. Some of the statutes fix the redemption price at the
amou~t of the mortgage debt and others at the amount bid for the prqperty
on the sale. In sup:?ort of statutes giving a period of redemption after
foreclosure and fixin{; the redemption "!.Jrice to agree with the amount bid
at the sale, rather than with the amo14.t of the debt, the following
arg~~ent has been made.
iThen the mortgagor1s interest is completely cut
off by the sale, the mortgagee, who in most instances is the purchaser,
will try to bid in the property at a figure lower than the debt secured,
and then endeavor to obtain a deficiency judgment against the mortgagor
for the balance. But when a redel:lption period after the sale is allowed
during wllich the property may be redeemed for the a~ount of the successful

CRC 52870 1&L No. 5 of 6
bid, the mortgagee will bid in the property for at least the full amount
of the debt, provided the security is adequate, for, as the mortgagor or
junior lienors can redeem the property for the amount bid, the mortgagee,
were he to bid less than the debt. would be left with an unsecured claim
for the difference upon redemption.

Some states prolong the equity of redemption by requ~r~ng complicated
and c-Lunbersome foreclosure proceedings. These involve expenses and uncertainties in connection with the title which benefit no one. A foreclosure
outside of court under an u.~regulated power of sale may. on the other hand.
result in the mortgagor being deprived of his property without the notice
requisite for judicial foreclosures and without adeq~1ate opportunity to
secure the protection of competitive bidding at the sale. Through statutory regulation of the power of sale it is possible, however, to establish
a foreclosure procedure which is simple, rapid and inexpensive; which
affords the mortgagee an efficient remedy against the borrower and the
securi J"y; viilich avoids 1')oss1ble uncertainties in the title; and which, at
the sa~e time, satisfies the mortgagor's wish for reasonable notice of tile
sale in order that he may have an opportunity to :9rotect his equity in the
property and avoid an unwarranted or excessive deficiency judgment. Under
the regulated power of sale ~rocedure the legislature may also make such
prOVision for a period of redemption before or after sale as may appear
reasonable ~Ulder the circumstances.
LEGISLATION: Adontion by the States of Carefull~
Drawn Uniform Mort£e~ and Foreclosure Legislation
in o~~er to Eliminate D~versity of Foreclosure Proce~~. to Provide Greate~ Social and Economic
Justice Between Mortgagors_and MortgClLgees and to
FaciE tate ~alings_ in Interstate Mortgage Credit.
In 1927 the National Conference of Commissioners on Uniform State Laws
drafted a proposed uniform mortgage act which was approved by the American
Ear Association, the National Association of Real Estate Boards, the American Title Association, the Association of Life Insurance Counsel, the Farm
'Mort~ge Bankers Association. and counsel for Federal and Joint stock land
banks. While a few states have incorporated some of the major features of
the uniform act into their mortgage and foreclosure laws, no state has as
yet adopted it fully~ One probable reason for this failure is the almost
equal division of opinion ar:long the states as to the desirability of a
period. of I'ed.emption after foreclosure and the similar division of opinion
as to the benefits of foreclosure under power of sale.
This Sub-Committee has made an intensive study of this proposed uniform law and it is in agreement with the National Commissioners as to the
desirability of having a carefully drawn tliliform real estate mortgage and
foreclosure law in force in all of the states which would facilitate the

CHC 52870 1&1 No.6 of 6
interstate flow of mortgage credit. However, the Sub-Committee is not of
the opinion that the proposed uniform law will in all respects accompliSh
these objectives. Accordingly, it proposes to draft a uniform law which
in its opinion, will afford a proper vehiCle for the accomplishment of
these ]?'L1.rposes. This draft will be submitted to the Central Housing Committee in a subsequent report.
In view of the present diversity of local op~n~on upon the procedure
which snould be followed in foreclosing mortgages on real property, as
evidenced by the many major and minor variations in the foreclosure laws
of the severa.l states as well as by the failure of the proposed uniform
mortgage act to obtain legislative recognition, this Sub-Committee recognizes the difficulties and delays which will be encountered in procuring
the enactment of uniform mortgage legislation. Accordingly, this SubCommittee further recommends that the foreclosure and mortgage laws now
in force in the several states be studied with a view to ascertaining in
what respects particular amendments in the laws of individual states
would facilitate interstate or intrastate dealings in mortgage credit or
tend to promote sound and equitable relations between mortgagors and
mortgagees, taking into account the conditions existing within the state
under consideration. In the opinion of this Sub-Committee, specific
studies of this character offer more immediate prospects for the establishment of mortgage credit transactions on so~~d foundations than any
other course of action which this Sub-Committee has considered. At the
same time, such studies will further the efforts to procure uniform
legislation in those states which are unwilling to enact such legislation
at present.
This report on the "Social and Economic Effects of Existing Foreclosure
Procedure and Emergency Moratorium Legislation", has been prepared for your
Sub-Committee on Law and Legislation by Mr. Burton C. Bovard, Counsel,
Federal Housing Adndnistration.

Bu.rton C. :Bovard
A. E. Dmton
H. Rowan Gaither
Paul C. A.kin
Hamilton Rogers
Monroe Oppenheimer


D of J



CHC 60263: A
to the
Sub-Committee on Law and Legislation's
to the
Central Housing Committee




(Compiled on May 15, 1935, and revised on August 20,
1936, by David A. Bridewell, Attorney, Federal Home
Loan Bank Eoard, from statutes listed in Loose Leaf
Service of Cormnercial Clearing House, Inc.; National
Housing Service of Prentice-Hall, Inc.; the individual statutes of the various states; judicial interpretation of the various statutes compiled from cases
found in the various advance sheets of the reports,
and in the Current Digest of the West Publishing Company. )

CHC 60263: A-l
]]rnergency legislation in aid of mor"gage debto:rs nay be roughly
classified as follows:

Laws prohibiting foreclosures and sales thereunder until
a certain date or for a reasonable time in the discretion
of the court:
Arizona, California, Delaware, Idaho, Illinois,
Iowa, Louisiana, Michigan, Montana,. Neb,raska,
New ·Haritpshire, New York, North CarOlina, North
Dakota, Ohio, Oklahoma, Pennsylvania, South.
Carolina, South Dakota, Texas, Ve~on~, a~d


Laws extending the period of redemption on mortgages in foreclosure. Most of this legislation is discretionary in form,
providing that the courts may, upon proper showing, extend
the redemption period for a reasonable time or for a definite
period, usually from one to two years. Strictly speaking,
these statutes extending the redemption period are not moratoria, but they have been treated briefly in the compilation
which follows because they are usually a part of the mort~ge
moratoria statu~es.
Iowa, Kansas, Michigan, Minnesota, New Hampshire,
South Iakota.


Laws abolishing deficiency judgments after foreclosures. North
Dakota has abolished deficiency judgments entirely, while South
Carolina has abolished them in foreclosures of purchase money
mortgages and deeds of trust.


Laws limiting the right to a deficiency judgment by requ~r~ng
the sale of the mortgaged property to be based on the "fair ll ,
II reasonable II , IIjust", or II equitable II value of the property.
The purpose of such legislation is to provide a means whereby
the property might satisfy the debt, even though depressed real
estate values make this impossible if the sale progresses normally. Most of these statutes empower the courts to deny confirmation of foreclosure sales where the IIfair market value ll o:r
the property was not bid. For instance, in Idaho deficiency
judgments in an amount greater than the difference,-between the
debt and the cost, and the reasonable value of the property,
are prohi bi ted. In Michigan and":'Wisconsin, the courts may fix
a minimum price at which the property can be sold. Other States
have set up local Appraisal Boards to pass upon the property




sold and set the price at which it may be sold. While these
measures, like the moratoria proper, are usually passed under
emergency power, they are not limited in most instances by an
expiration date, and ~ence, will, unless repealed, constitute
a pel~ent change in foreclosure practice.
Arkansas, Arizona, California, Idaho, Kansas.
LOuisiana, Michigan, Minnesota, MisSissippi,
Nebraska, New Jersey. New York, Pennsylvania,
South Carolina, South Dakota, Texas and Wisconsin..
In connection with a study of these emergency mortgage moratorium
statutes, i t should be ke:pt in mind that the Supreme Court of the United
States, on Jan. 8, 1933, handed down a decision in the case of Home Buila
ing ~~d 1oc~~ Assoc. v. John H. Blaisdell and Rosella Blaisdell, his wife,
54 S. Ct. 231, 290 U.S. 398, u~1olding the mortgage moratorium law of

CHC 60263:



Le~l actions, pending or ins"ti tuted before October 1, 1939, for
recovery of debts secured by any mortgage or"lien on real estate, must
be stayed until mortgage or lien is fOl'eclosed. Debtor may set off fair
marJ.;:et value of the security. (Laws of 1935," H .B. 422, effective June
2L1, 1935.)


Constitutionality -p:phe"ld in Mutual Building & Loan Assn. v. Moore,
(Ala. Sup_ Ct., JURe 11,1935.)


Prohibiting Foreclosures

In ~ending or future real estate mortgage foreclosure suits, the
court ma.y order a" two-year continuanceu..."'lless good cause to the contrary
is shown. (Cltapter 29, Laws "of 1933. App~ovea and Effective March 4,
Laws Limiting Right to Deficiency Judgment
No deficiency judgment may be given plaintiff in foreclosure suit
uniess""it is proved that, at the time the note and mortgage were exe- "
cuted, the value of the property was in excess of the" amount remaining
due on the note. (Chapter 88, Laws of 1933. Approved March 18,Effective June 13, 1933).


Answers in suits to foreclose mOrtgages, deeds of trust, or pledges,
execu.ted pl'iol' to January 1, 1933, shall not be due until three months
-after service of summons or publication of warning order. In fixing
date of sale and confil~ing sale, court shall consider the condition of
debtor, economic conditions, and the fair price of the property.' Provisions of Act do not apply to mortgages, deeds of trust, or other liens
exec;). ted subsequent to January, 1933. (Act No. 21, Laws of 1933, Approved ru1d Effective, February 9, 1933, as amended by Act No. 49, Laws of
1935. Approved and Effective Febr~~ry 18, 1935).

CHC 60263 :A~
APXANSAS (Continued)
Laws Abolishing Deficiency


Defici"ency judgments abolished by requiring mortgagee to bid amount
of loan plus interest and cost (or fair value of the :9roperty if the
value was more than the loan) in>foreclosure proceedings. (Act No. 57 t
Laws of 1933, Effective February 25, 1933).
~lis Act held unconstitutional, ~s violation of United States Consti tu.tio-n-, -Article 1 - Section 10, and Constitution of Arkansas, Article
2 - Section 17, in Adams v. Spillyard, et al., 61-S. W~ (2d) 686.




Until January I, 1934, sales under a power of sale in a mortgage or
dee_d of trust or decree of foreclosure of real property, improved wi th a
single falnily dwelling; in cases where default in payment of principal
only exists, are prohibited. (Chapter 263, Laws of 1933, Effective May
9, 1933, Chapter 1057, Laws of 1933, Effective August 29, 1933).
Until February 1, _1935, sales under certain mortgages and deeds of
trust, except mining property and the foreclosure of vendee's interest
under certain contracts of purchase, for default in payment of principal
only, are prohibited. The statute of li..mitation on such obligations is
extended. Permits avoida..l1ce- of sale or forfeiture and postpones sales
for default of installment payments until after effective date, February
1, 1935, and prevents actions against guarantor's obligations and the
enforcement of security which is effected by the Act. (Chapter 1, Session Laws of 1934, Approved September 15, 1934).
This Act was construed in Trompeter and Company (O.V.) v. Superior
Court, County of Los .Angeles, California, 80 Cal. App. -Div. 961.
Until September I, 1935, in the foreclosure of a mortgage or deed of
trust, the C0 1lXt may provide that the sale of the property shall not be
held until or after such date as the court considers just and equitable,
but in no event -later than September 1, 1935. Statute of limitation extended. (Assembly Bill No. 23, Laws of 1935, Approved and Effective
about February 1, 1935).
Peti tion for Post"ponement of Sale
Mortgagor or trustor under certain deeds of trust may, within 90

CID 60263:


CALIFORNIA (Continued)
days after notice of default, or within 30 days. after July 2;1., 1935, but
not later th~~ January 1, 1937, petition for postponement of sale. Court
may :o)ost:rone s~le not later than February 1, 1937. Redemption period
may be e}:tended to Febrt'tary 1, -1937. ~Chap.348, Laws of 1935, Effective June ;31, 1935. Bepeals ClIap.lj Laws of 1934, Effective Se:ptember
15, 1934, and Chap. 7 t Laws of 1935, Effective .Janucu:y 31, 1935.)
In 1'e Porter (Superior Court, Los Angeles County, California, July
31, 1935) held unconstitu.tiol1B.1 Chap. 348 insofar as i t applied to a
post1Jonement of sale under chattel mortgage, but upheld the prOVisions
re1athlg -to real property.
Ban}: of America v. Pierson (Superior Court, Los Angeles County,
Calif., 1935) upheld constitutionality of c. 34B, Laws of 1935.

Laws Lind tin€!: Right to



DefiCiency judgments after foreclosures limited to the amount by
which the debt exceeds the fair market value of the property. No deficiency judDJlent when the mortgage or deed of trust was executed to
secure all or a:n.y portion of the purchase price of. the property to which
such mortgage or deed of trUst applies. Until thirty days after Approval and Effective date of this Act, no sale or ,decree of foreclosure.
Where period of redemption has not expired, same may' be extended until
September 1, 1935. This Act does not apply to mortgages executed subsequent to the effective date of the act. (Chapter 793, Laws of 1933,
Approved and Effective August 21, 1933).
This act held unconstitutional in Bennett v. Sunerior Court of Los
Angeles County, et al., on February 27, 1935, 42 Pacific. Beporter, 2d
Series 80 - Adv~~ce Sheet, as impairing obligation of cqntracts.
There is no mortgage moratorium law in this State.
No mortgage moratorium laws were passed during the emergency period
in this State, probabl~r because foreclosure provisions of the statute of
the State provide that the C01.:trt has the right to set the ·time wi thin
which the defendant must payor be barred. Such provisions, of course.
give the court the discretion to extend the period of redemption, which
is provided for by the current legislation in other States.

CHC 60263:


Law Extending Time for E.."'tecution Process
Execution process may be stayed for six months when application
has 'been made to the HomeOwner IS ·;Loan· Corporation for refunding of
the mortgage. (Chapter 39 Second Spe~ia1 'Session, 19.33, Approved
December 18, 1933, Expired March 1, 1935).

No elnergency mortgage moratorium legislation has been enacted in
the Di s tl'ic t •

No emergency legislation in aid of mortgage debtors has been
passed by this State.
The Supreme Court of this State has held, in a recent case: uIn
the a'bsence of mortgage moratorium s.tatute, courts are without authority to extend redemption period in foreclosure proceedings and to stay
such. proceedings during :periods of economic depression." - Morris v.
White, 160 5e. 516.

As foreclosure l~ws ~re lenient on mprtgagor,providing for a
long period in which .~Or~~gor may pay before decree given and as
mortgagor may redeem a.t aiiy, .time wi thin .~en years from last recognition by' mortgagee of right of redemption, the Legislature of this
State evidently determined that no emergency mortgage moratorium legiSlation was necessary.

Law Su.spending Real Estate Mortgage Foreclosures
Until December 31, 1934, the Governor was authorized to declare
legal holidays limited to certain businesses and activities for one
or more periods not to exceed more than sixty days each. (Chapter
124, Session Laws of 1933, Ap:P1'oved March 2, 1933.)

CRC 60263:


IDAHO (Continued)
On July 18, 1934, the C--overnor of the State issued proclamation
effective midnight of that date until September 15, 1934, declaring a
legal holiday with respect to foreclosure of mort~ges upon real estate and fOl'eclosure or cancellation of contracts for the sale of real
estate. The District Courts and Judges were empowered and authorized
to suspend any or all proceedings of the above nature upon application
of Emy c.efendant in any such action. This proclamation of the Governor
susyending real estate mortgage foreclosures was held unconstitutional
in .~lianCe Trust Company v. Hall, 5 F. SUpp. 285.
Court may extend action for foreclosure of a mortgage on real e~
tate until March 1, 1937. Execution of deed to property already sold
at sheriff's sale may be prevented until March 1, 1937. This act not
applicable to mortgages pledged to secure payment of public debt or
deposit of public funds. (Chapter 36, Laws of 1935, Approved and Effective February 20, 1935.)
Law .Th:tending Redemption Period
Court empowered to extend time for redemption from sales under
execution until March 1, 1937. (Chapter 36, more specifically cited
above .)
Law Lirnitin£. Right to



No deficiency judgment may be entered in any amount greater than
the difference between the mortgage indebtedness, plus the cost of
foreclosur~ and sale and the reasonable value of the property. (Chapter
150, Laws of 1933, Approved and Effective March 10, 1933.)
Moratorium period provided by legislation in this State has now
Evidently no emergency mortgage moratorium legislation has been
enacted in this State. However, present foreclosure laws are rather
liberal to mortgagor.
Unless a mortgage contains an express covenant for payment of
the money secured, or there is a separate bond, or note, or other
agreement to pay the sum due, the remedy of the mortgagee is limited
to the property mortgaged.

C3:C 60263: A-8

Actions for the forec1osu!'e of mortgages and deeds of trust on
real estate may be continued until March 1, 1935, upon a:,)!>lication of
the ovmer. unless. u:oon a hearing, good cause is shown to the contrar~T.
(Ch~oter 182. Session Laws of 1933. Ap:oroved and Effective February 9.
1933. Expj.res March 1, 1935). Act held constitutional in Cra.ig v. Waggoner. 256 N. W. 285;
constI'"'.led in Reed v. SnOVl, 254 N. W. 800; McDonald v. Ferring, 255 N. ri.

Court m~- order continuance until March 1. 1937, in ~ending or
future suits for the foreclosure of real estate mortgages or deeds of
trust, unless good cause to the contrary is shown. All applications
made with court under Act of 1933, Chapter 182, are considered refiled
under t:lis Act. This Act does not ap:?ly to mortgages or deeds cif trust
subsequent to January 1, 1934, nor where the real estate was acquired.
subsequent to such date unless continuance has been granted under Acts
of 1933, Chapter 182. (S .F •. No. 34; Session Laws of 1935, .Approved
February 4. 1935, Effective FebruarJ 8, 1935).
First Trust Joint Stock Land Bank of Chicago v. Loizeaux et al ••
Iowa Dist. Ct., Dubuque County, November, 1935, held this lawunconstitutional, the economic emergency no longer existing, and the contin~tance authorized being in violation of the Constitutional provision ',wohibiting impairment of contracts ..
.k..1Y actions on land contracts exe·cute(i T.)rior January 1, 1934;
wherein the vendor has r~tained legal title, may be suspended until
Ma!'ch 1. 1937, unless good cause to the contrary be sho\vn. Within
thirty days after service of notice., of forfeiture, a suspension of
proceedin~s may be obtained abating 'the action until March 1, 1937.
unles$ good cause to the qontrary be shown. (S.B. }To.· 59, Laws' of
1935, ~~roved and Effective February 20, 1935, Expires March 1,
1937). Extending Redemption Period
In forec1osu;re suits where the redemption period has not expired,
the court may order. unless good cause iss~own to the contrary, that
no sheriff's deed shall be issued until March 1, 1935. In'the meantime the owners may redeem the '1)roperty and are entitled to the 1?ossessian thereof. (Cha'1)ter 179, Laws of 1935, Ap:oroved and Effective March
18, 1933, Expired MarCh 1. 1~35).

'Elis Act held constitutional in Des ~loines Joint Stock Land Bank
217 Iowa 1319, 253 N.W. 701, on the ground that the state


CHC 60263: A-9
,IOWA (Contimied)
has a right to legislate for the welfare, of its people in times of economic em31'cency. Decided on basis of Home Building and Loan Association
v. Blaisdell, 290 U.S. 398, 54 S. Ct., 231, January 8, 1933. Also held
consti tut:Lonal In : Connecticut Chain Life Insurance Company v. ,Roth, 254
Construe'd in lIawkeys Life Insurance Company v. Qgg, 254 N.U.
847, Equitable Life :Assurance Society v. Kramer, 253 N.W. 809; Tuska v.
Ebernart.' 256 N.W~,740; Illinois State Bank of Q.uincYt Ill., for use·
and benefit of Jonson v. Dawson, 259 N.W. 196.
In any action' for· the foreclosure ofa re'al estate mortgage or a
deed of trust comrnenced''Prior to Ma1'ch I, 1935', and in. which a decree
has been or may hereafter be entered, but the redemption period has not
expired, the court may order that no sheriff's deed ~ha11 be issued until Marcil 1, 1937, and in the meantime the owner or owners may redeem
such :oroperty and are en ti tIed to possession thereof. 'Ihe provisions
of t:lis Act apply only to mortgages or deeds of trust eKecut~d ~rior to
March 1, 1934, except in cases where the period of redemption has been
extended by court order. (H.F. No. 84, Session Laws of 1935, Approved
February 6, 1935 t Effective -February 8, 1935).
lJone of the provisions of. Chapters 179 and 182, Laws of 1933, shall
apply to mortgages made on and after January 1, 1934. (H.B. 357, First
SpeCial Session Laws of 1933, Approved and· Effective March 12,1934).

to Judgments

Judgments rendered hereafter on yromissory obligations secured by
mortgage or deed of trust, but wi thout foreclosure, are non-renewable,.
and are void after 2 years - e;x:cep't for purposes o,f set-off. Judgments
rendered heretofore or pending 'are without effect after 2 years from
passase of bis Act, except as a set-off. (Laws of 1935, S.B. 176, approved A;pril 29, 1935, effective on'publication.)

I!1 mortgage foreclosure l1roceedinfs, courts of equfty are deciared
to -nower to refuse confirmation where bid is inadequate or the sale
is in any way unfair. Court may fix !>rice· at w~:ich l)roperty is to be bid
in a sale is to be confirmed. (Chanter 218, Laws of 1933, Effective
March 7, 1933).

Tnis Act held unconstitutional by United States District Court in
Phoenix Joint Stock Land Bank of Kansas City ,v'. Dewey, et ale 8 F. Supp_
678, and construed in Prudential Insurance Company v. Ziegler 140 Kansas

CHC 60263: A-10
KA}TSAS (Continued)

the Period of. Redemption

3y jQintresolution No. H~, a moratorium was declared on al1 periods
of redem'Dtfons from judicial sales for six months after March 4, 1933 •..
The Governoll was -given -pmver to extendIIioratorium for six more months -if
he deemed it necessary for the ,preservation of the ~blic peace, safety,
etc. (Chapter·232, ·Laws of 1933, Approved March 20, 1933; Effective Harch
;:n, 19:53).
T,lis Act was held unconsti tutional in extending a moratorium until
Septemoer 4, 1933, Lingerfelt v. Hieroninus, District Court, Labette County,
July 29, 1933, Oa.1dand State Bank v. Bolin, 40 P. (2d) 437. Construe(l. in
Phoenix Joint Stock Land Bank v. Dewey, 8 F. Supp. 678, The ~oratorium as
exter.Lc..ed by the Governor for an addi tional six months was also held uncO~lsti tutional by the Wyandotte District Court in McDonnell "tI. Cannavan on
October 20, 1933.
The :period for redemption on real es'tat'o' ma\V "be extended {or suc}}.
additional time as the. court shall deem it just and equitable, 'but in no'
event beyond March 1, 1935. (Chapter 3, Second Special Session, 1934.
Approved March 2, 1934, Effective March 3, 1934.)
Tne period of redemption, as extended under Chapter 3, Special Session
Laws of 1934, may be further extended until January 15, 1937. Provisions
of t>is Act do not apply to a purchase :orice mortg~e where less than onethird of the nurchase "'lrice has been paid, Ear to any real estate where the
sarne is :!ot occ'll:pied in good fa! tho Nor in cases where the court has found
that the ):)remises have been abandoned by thei owner. lIor to an owner who haE
acqui:-ed title since March 4, 1933. (H.B. 299, Laws of 1935, Approved
F€brw1~r 28, 1935, Effective March 1, 1935).

0"ntil March I, 1935,. no deficiency judgment shall be enforced unless
a period of redemption as allowed b~r existing law or as extended under the
'provisions of this ....ct, has ex:pired. (Chapter 3, Second SpeciDl Sess,ion
1934, Approved March 2, 1934, Effective March 3, 1934).
Prior to January 15, 1937, no deficiency judgment shall be enforced
until t~!e period of redemption a:;J allowed by existing law or as extended
by t~cis Act, has expired. (H.B. 299, more specifically cited above).
iro' emergency 'mol'a:torium laws have been passed by this State.

CHC 60263: A-II

,'st:rtct c01lrt is give,n authority to :)ostpone foreclosUre' sales on
petition ",of the mortgagor or' owner in possession until the second Monday
in M~~, 1~36. Mortgagor may be ,direeted to pay rental or income value
of land for the 9a;:'lIlent of taxes, insurance~ ~nterest, etc. The Act
ap-plies only ~o mortgage made prior to the a:oproval of this 'Act. (Act
!'To. '159, Laws of 1934, ApJ'roved July 13, 1934, Effective August 1, 19~Y--:!).
T:.iis Act, was construed in Hewman v. Reems, 158 So. 13; Me~~roJ?olitan
CasUc:-=U ty IriS111'a.nce Company of H"ew York v. Bowden, 159 50'. 394. In MetropoJ.itan Life Insurance Compa..'I1Y v. Morris, 159 So. 388, it'was held that
this m9ratorium. statute vms not "an unreasonable exercise of the State's
police !>owcr in view of the ,ecommic emergency - - _II.
1D:.!:L1:!:ov~dtng for the Abolition of Deficiency Judgments

RiGht'to deficiency judgments is abolished where creditor avails
himself 0::: the waiver of appraisement. This Act appliel? only to obligations e.l'ising after this Act becomes effective. (Act No. '28, Laws of
1934, Ap-tJroved July 12, 1934, Effecti ve ,August 1, 1934).

on All Debts

T:1e Debt Moratorium Commissioner (State Bank Commissioner) has
autllOrity under such rules and regulations as he ,may prescribe, to
suspend all laws relative, to the enforcement of all debt, public or
private, e~~ept debts owed to the state and to ~he Un~ted States, and
to sUs',)end all laws authorized for the reduction of such debt to judgment a~d the enforcement thereof or the enforcement' of any mortgage secur in.;,; ,same. 1-To extension shall be granted for any period after two 1 ve
0' clock noon on the 20th day after the adjou~~ent of the regular session
of tlle Legislature for the year 1936. After three months, any credi tor
m~ an:'11y Vii th the Commissioner for hearing to determine J?ayment
of debt sI1o-o.1d be su~rpended. The Commissioner may approve any com:.oosition to ",:rdch the Creditor and debtor agree. (H.B. No.2, Laws of 1934,
Approved Eovember 21, 1934, Effective December 6, 1934).
Tile above law, H.B. No.2 .. 1934, authorizing Debt Moratorium Commissioner to suspend certain debtors' obligations, on, application, until
ex~irationdate of act, was continued.
(Laws of 1936, H.B. No. 300, a:.oproved June 22, 1936, expires 20 days after 1938 regular session adjourns.

:To emergency mortgage moratorium legislation has been passed by
this Stc,to.

CHC 60263:: A-12


Restricting Power of Sale and Foreclosure


In all c·ases ,submi tted to either the Circui tCourts or BaltimorE;) City
Courts for the. p~ssage of a as provided in Section 720 of the Code
of Public. Laws of Maryland (1930 Ed.). no decree shall hereafter be .passed,
during theperi"od ·o.f emergency, unless such application is concurred in by.
the reco~d holders of not less than 25% of the entire mortgage debt. (Chap.
5?; Session Laws of 1933, Ap~roved Dece~ber l5, 1933, Expired June l, 1935.)
. T-,-ds act declared '\Ulconsti tutional in U. S. Mortgage Compani' v.
Mathews·,.l73 A. 903, July 6, 1934 but reversed in 55 S. Ct. (Md.) 168,
December· 3, i934.·
In all mortgages of real estate qud/or leasehold property, wherein
there is inserted a clause authorizing the mortgagee or any other person
to be named therein to sell the mortgaged premises, such power of sale
shall not be exercised during the period of the emergency except by 3l,ld
with tile consent of the record holders of not less than 2~ of the entire
unpaid prinCipal debt secured by the mortgage sought to be foreclosed.
(Chapter 57," Session Laws of 1933, Approved and Effective December
15, 1933, ExPired June 1, 1934.)
No emergency mortg'agemoratorium legislation was ena~ted by the Legislatu.::.'e of this State. 'This was' probably due to the liberal redem"Y)tion provisions made for mortgagors under the present legislation, i.e~, a mortgagor may, after breach of condition, redeem the land mortgaged, unless
the mortgagee orpersonclaizriing or aolding under him has obtained !)ossession o~ the land and has continued that ~ossession for three years, or
unless the laii"d hM. been sold pursuant to the power of sale contained in
the mortg~ge •.

Laws .. Postponing .Foreclosure of a


Pending or £urture'actions for the foreclosure of real estate mortgages or deeds' or trust' or for the ~pecific performance of land contraets
may be continued untii not later than March 1,' 1937"upon good cause shown.
Foreclosures by advertisement may be continued where equity of redem~tion

CHC 60263: A-13
MICHIGAN (Continued)
has not e~ired. Foreclosure by advertisement may be brought into Court
and continued. (No. 98,Acts, of 1933. Approved and Effective June 2,
193~-;, Expired'March 1, 1935, as amended by No. 20, Acts of 1934, Approyed
and Effective March 28, ':!:934;,No. 3, Acts of 1935, Approved and Eff~ctive
Februar·-.f 26,' +935, Expires March 1, 1937; and as further amended by No.
152, Acts of'1935 and No. 158, Acts of 1935, Effective June 4, 1935.)
~lis Act held constitutional and not one impairing the obligation
of contracts in Russell v. B;:Lttle Creek L'UIilbe.t Company, Michigan S. Ct.,
January 30, 1934, 252' N. W. 561, 265M! chi gan 649. The court de ci de d ,
the case on the authority of Home Building and Loan. Association v. Blaisdell, 290 U. S. 398. 54 S. Ct.231. This'A.ct was construed in Young v.
Union Joint Stock L~d Bank of Detroit (1934) 203 N.W. 225, 266 Michigan
83; Dau.cherty v" Reading, 254 N.W. 189, 266 Mic;migan 5:1.4; JaaQ,ra v. Van
OIffinen, 252 N. W. 485,.265 Michigan 673; Becker v. Detroit Savings Bank,
257 ]:J. rio 853; Virginia Joint Stock Land Bank v. Hudson, 254 N~W. 234;
Micb.iE;[m Trust Co. v. Rose, 259 N.W. 878.

Larl Extending Redemption Period


redemption period may be extended in mortgages already fore(This' is a. part of .Acts more specifically set forth above.)

In all :actions now pending for the forfei ture, foreclosure, or
specific performance of an executory contract for the purchase of real
estate in which a Writ of 'Restriction has not been 1ssue~ 'or in such a~­
tion$ 11ereinafter cOlnmenced
a court of chancery, the court may extend
the time in which the right ,of redemption may be exercised until March 1,
1937. (Act No.5, Laws'of'-1935; Approved and Effective February 25,
1935. Expires March 1, 1937.)


Law Limi tint Right to Defic:r.ency Judgments
NO 'deficiency judgments entered after January 1, 1933. ~lle enfClt'ced
until March 1, 1937. The Court may determine fair rental' terms.
(This :?rovi~ion is a part of Acts more 'specifically set forth above.)
Law Giving Court Right to Set Price at Which Land is Sold at Foreclosure
~le court may fix and determine the minimum price 'at which the real
property may b.e sold under foreclosure proceedings. (No. 229, Acts of
1933, .I\-pproved and Effective July 5, 1933.)



Foreclosure Proceedings

Court may postpone actions heretofore commenced for fpreclsure
of a mortgage on real estate. In case mortgage has been'foreclosed, the

CHC 602G'): A-:-14
MIm{IDSOTA (Continued)
court ~a.y order a resal€· if the, sale :rrice is unreasonable and inadortuate.
The court m3\V postpone· the enforcement of judgment by t:?xecution sale. Ho
extension or:'.::PGstponeme.nt may be granted under. this Act until March I,
1937. T'..lis Act does not,apply to any mortgage held by the UlJ.ited States
or any of its agencies, nor to. any mortgage pledged to secure a public
debt or"to:secure -payment of d~posits of public m9ney. (H.F. No. 431,
Session Laws of 1935, Anproved and Effective March 17, 1935.)
Previsions of the above act extended until March 1, 1937 (Chap. 47,
Laws of 1935, AIl:Proved and Effective March ;1.5, 193~.)

': ':~~lere real estate has been foreclos,ed or where sale i,s ordered in
real·,estate proceedings instituted 'Drior to two years after this Act,
the pc'riod. of redemption may be extended for such addi tional 'time as
the court may deem just and equitable, but in no event beyond May 1, 1935.
Court 1:1a;;' order resale in foreclosure by action where sale price appears
unreasona.bly low. (Chapter 339, Session Law.s of 1933, Approved and Effective .A,.'Orll 18, 1933, Expires May I, 1935.)
This Act was held consti tutional in Blaisdell, et al., v,., Home
:Bu.ildin&; and Loan Association (Minn., July 7, 1933), 249 N. W. 334. 'rhe
decision of the Minnesota Sunreme Court was upheld in the Sunreme Court
of the United States in a decision handed down January 8,1933, 54 S.
Ct. 231, 290 U.S. 298. The decisions in both courts were rested unon
t~e following argument:
While it was conceded that the statute imnaired
the obliiJl3tions of the mortgage contract, the existence of the eCQnomic
emergency justified the Legislature in exercising its police power to
relieve tl,e people from the devastating effects of that' emergency.
In G]~ace v. Lichtscheidl (Minn., July. 7,,1933),249 N.W. 672, it
was l'leld that, if the law is valid so as to permit extension of period of
redem·)tion from mortgage foreclosure sa.les of homesteads, it should also
be valid to permit extension of redem:otion, period from I!lortgage forec1o,,:,"
sure sales of ~roperty not homestead of mortgagor. This Act was further
constFaed in Anderson v. Hill (A~ril 20,1934),254 N.W. 585; Swanson v.
Cro s s Lake Land Company, 2,55 N
812, Young v. Penn Mutual Li fe Insurance Company, 256 N.W. 906; Mosse v. Mutual Benefit Life Insurance Company, 259 N.W. 19.


7l"..e "()rOV1Slons of the above Act were extended to March 1, 1937
(Chapter :~;7, Laws of 1935, Approved and Effecti va March 15, 1935.)
Laws Lil!;li ting Right to Deficiency,Judgment
?;:'ior to May 1, 1935, no action shall be maintained on a deficiency
jud.@nent until the period of redemption as allowed by existing law or as
exte:'"decl lmder this Act, has,expired. (Chapt~r 339, more specifically
set fol't:.l above.)

CHC 60263: A-15
MINl-1ESOTA (ContinueAl
Prior to March 1, 1937, no action may be maintaineq for a defi?iency
judg}llent until the period of redemption as allowed by existing law or aE:!
extended under the provisions of this Act, has expired •. (R.F. No. 431,
more s?ecifically set forth above.)

Actions on deficiency judgments are barred to not later than March 1,
(Chanter 47, Laws of 1935. Approved and Effective March 15, 1935.)

Law Postnoning Foreclosure of Mortgage
i'!!ortgagor rna:' enjoin proceeding to foreclose mortgage, provided he
shows tha.t he .has sQught to refi~nce his mortgage through some Federal
agency. In suits to foreclose mortgages and deeds of trust executed
after March 4, 1933, the court shall fix an ''upset" price and shall direct
the mortgagor to pay all or. a portion of the rental value of the .nremises
to the mortgagee for a term not to exceed two years, after which the
property may be sold. (H.B. 270, Laws of 19.34, Approved and Effective
April 4, 1934, Expired May 1, 1935.)
Held constitutional in Wilson Eanking Co., et al., v •. Co1vard, Miss t
Sup. Ct., . April 22, 1935. Held inapplicable to Federal Land Bank on
Federal as~ncy theory. Federal Land Bank of New Orleans v. Tatum, et al.,
Miss. Sup. Ct., November 25,1935.
Foreclosure procedure for mortgages executed before March 4, 1933,
established. (S.B. 84, Laws of 1936.)
Law Limi ting Right to Deficiency JuQ€E.ent
Prior to May 1, 1935~ no action may be maintained for a deficiency
judgnent until the period of time extension allowed in ~y proceeMng begun under this Act shall have expired. (Chapter 274, Laws of 1934, A"!)proved and Effective April 4, 1934, Expired May 1, 1935.)
Deficiency judgment suits prohibited before March 1, 1935.
Laws of 1936, Effective May 1, 1936, Expires May 1, 1938.)

(S.B. 84,

No emergency mortgage moratorium legislation has been passed in
tl'lis State. Probably t..'lis is due to the fact that 'the provisions for
foreclosure and redemption of property in this State are rather lenient
to the :Jortgagor.

CHC 60263: A-16
Law to




llortga.gor-~wner may make
all :oroceedings in pending or
given authority' to study such
yond Iharch 1, 1935. (Chapter
March 14 t 1933.)



application with court for an order sta:.rin:,;
furture mortgage foreclosure actions. Court
proceedings for ay.>eriod not to extend be116, Laws of 1933, Approved and Effective

Period of Redemntion

Court may extend period of redem:9tion for such additional time as it
may deem just and equitable but in no event beyond March 1, 1937. This,
Act applies only to mortgages upon real property and in which the period
of redemption has not yet expired and in pending and future proceedings.
This Act does not apply to mortgages made after the approval of t:le Act.
Nor do provisions of the Act apply to any mortgage while it, is held by
the United states or by an agency, department,board, or commission thereof, nor any mortgage held as security for payment of a public debt or the
deposit of public funds. (Chapter 122, Laws of 1935, Approved and Effective March 13, 1935.)
Law Limi tins Right to Deficiency Judwent
Deficiency judgments are abolished in all actions for foreclosure
of mortgages for balance of purchase price of real property. (H.B. 16,
Laws of 1935, Approved and Effective February 6, 1935.)

Law Prohibi ting and Postponing Foreclosure
Courts may stay foreclosure pro'ceedings of mortgages on real estate,
unless good Cause is shown to, the' contrary, until the first day of March
1935, or so long as the Act is iIi. effect. (Chapter 65, Laws of 1933, Approved and Effective March 2, 1933, Expires March 1, 1935.) This lar;
was construed in Castek v. Tuggey, 265 N.W. 506.
The provisions of the above Act were extended until March 1, 1937.
In addition, tax sale foreclosures and. actions on notes secured by real
estate nere also stayed, wi thin the discretion of the court, until March
1, 1937. Provisions of the Act do not apply to any mortgage, 'deed of
trust, land sale contract, or secured, note to be i.ssued subseqUent to.
March 1, 1934~ (H.B. 1, Laws of 1935, Approved and Effectiv'e Februar:T
27, 1935, Amending and Repealing Sections 20-21, 159 and 2021, 161, C.
S. Supp. 1933; Expires midnight March 1, 1937.)

CHC 60263: A-17
NEBRASKA. (Continued)
Law AboliShing Deficiency Judgments
Deficiency judgments are aboli'shed'in mortgage fQreclosure~ actions.
(Cha"'Jter 41, Sessio'n Laws of 1933, Approved, 'and Effective April 26, 1933.
Also, ci ted as H.B. 10 and as Sec. 20-2l4i; C.S. SU}?:9. Nebrasr..a.)

No emergency mortgage moratorium legislation has been enacted in this
State -orobably because there is a one-year redem1?tion pe:rioQ. for T)r,operty
sold under foreclosure of mortgage in this state.

Law!ostnoning Foreclosure Proceedings
'!he court may suspend an action to foreclose a mortgage on real estate or it may suspend for a reasonable period sales in foreclosure action.
(Chapter 161, Laws of 1933, Approved and Effective June 15, 1933. EA~ires
within four years unless the Governor proclaims the emergency ended; as
amended by H.B. No. 56, Laws of 1935, Approved and Effective Februar~r 7,
Law Extending Period of Redemption
'!he court may extend the redemption period in proceedings to foreclose a mortgage on real estate for a reasonable time. (See Statutecitations above.)



for Sale at Fair Market Value of Property

1air market value in sale on IJropertyin 'mortgage f.oreclosure actions
required. Mortgagor, when sued on a deficiency judgment, may raise issue
of the fajr'nnrket val:ue.. (Chapter 82, Laws of 1933, Approved and, Effecti ve March 29, 1~3~.)
This.statute was declared unconstitutional by the SUpreme Court of
this State in Vanderbilt v. Bruton Plane Company (N. J. November 23, 1933),
III N.J.L. 596, on the ground that the statu'tory setting of a :fSi,r market
value, standing alone, as a self-sufficient, resistless fact in reduction
of an otherwise collectable debt, was such a restriction and limitation
u~on the mortgagee's right of recovery on a bond'as to be an impairment of

CRC 60263: A-18
NEWJERSE'Y (Continued)
pre-existing contract and therefore in conflict With Article 1, Section
10, Subdivision 1, Federal Constitution and Article 4, Section 7, Paragra,h 3, New Jersey Constitution, prohibiting passage 6f law im~airing
obliGation of contracts, or depriving a 'party of an;)r remedy for enforcing a contract which existed when contract was made.
lTo emergency mortgage moratorium legislation has been enacted in
this State •. However, by the laws of 1931, Chapter 149, Page 260, Senate
Bill 63. junior lien holder.s and the mortgagor are given 'a right of redemption, but this right has existed in New Mexico prior to 1931.

Law Prohibiting Foreclosure Proceedings
}!o e,ction for the foreclosure ·of a mortgage on real estatE;) solely
on account ofdefau1 t in payment of principal and, no t;l.C tion on any bond
secured by such mortgages shall be brought before July 1, 1937. This Act
applies to participation mortgages and mortgage bonds. All pending ac-,
tions are dismissed. (Chapter 793, Lt;l.wS of 1933, Approved and Effective
August 26,1933, as extended by ,Chapter 278 (Act No. 265), Laws of 1934,
Approved ~~d Effective April 23, 1934, QY Chapter 1, Laws of 1935, Auproved and Effective January 18, 1935, and as further extended by Chanter 86, Laws of 1936, Effective March 6, 1936.)
This Act was held constitutional as not impairing obligation of
contract in McCarty et al."v. Prudence Bonds Corporation, (N. Y. S" Ct. ,
Special Term, September 20,1933),266 N. Y. S. 629-C793. Thi~ Act was
also construed in Cole v. Miller (1934) 268 N. Y. S. 443; 150 Misc. 32;
Bank of Babyl.on v •. F. E. Summers Coal and Iiumber ComT,lany, 268 N. Y. S.
46, 149 Misc. 617; Laporte v. Druiss Company, 273 N. Y. S. 11; ~ose~h
E. Marks Company v. Rattan, 269 N. Y. S. 210; Sherwin v. Jones, 269 N.Y.$.
121, 150 Misc. 342, Rev. (City Court) 267 N. :Y. S. 759, 149 Misc. 481;
Manufacturers' National Bank of Troy v. Toole, 274 N. Y. S. 168; Kinke v.
Samuels, 190 N. E. 324, 2.64N. Y. '144, Rev., 268 N. Y.' s. 551, 240' Ay,rp~ .
Div~ 1008, Resettled 269 N. Y. s. 912; Kress v. Central Trust Co. of
Rochester, 153 Misc. 297; Westchester Trust Company v. Fox 276 N. Y. S.
-rlflere the principal of mortgages shall become due, prior to July 1',
1934, it shall become payable six- months after the expiration of the
emergenc~r neribd.
The principal of mortgages becoming due between July
1, 1934, and July 1, 1935, becomes :payable one year after the expiration
of the emergency period. Actions for the principal of mortgage boncls are
likewise suspended. (Chapter 357, Laws of 1934, Apnroved and Effective
May 7, 1934.)

CHC 60263: A-19
. NEW YORK (Continued)
Laws Limi ting Right to Deficiency Judgments
Deficiency judgments after foreclosUre shall be granted only on
motion, and if no motion· is made within ninety days after confinnation
of the sale, such sale shall be in full satisfaction of the debt. Deficiency judgments shall ~ based upon the fair and reasonable market
value or the. sale price, whichever is ·higher, of the mortgaged premises
du:r;-ing period of emergency, which extends to Jiily 1, 1936~(Chapte1'794,
Laws of 1933, Approved and Effective A~P"\lst 28, 1933, as extend~d 1;>y Act
110. 270, Laws of 1934, Approved. and Effectiye April 23, 1934, as extended'
by Chapter 2, Laws of 1935,.Approved January 18, 1935, as amended by Cha~­
ter 268, Laws of 1935, Effective April 1, 1935, and as further extended
by Chapter 87, Laws of 1936, Effective March 6, 1936.)
The period of emergency provided for by the abov~ legislation was
extended Until July 1, 1935, by Chapter 277, Laws of 1934 and further
extended to July 1,1936, ·by Chapter 2, La,vs of 1935.
Tl; Act was interpreted in Railroad Co-op. Building and Loan Association v. Boston Building, Inc., et ale (N.Y., Sn~p1. Ct., Special Term,
Nov. 3, 1933), 267 N.Y.S. 204, in which it was held that. retroactive law
which tends to take away or impair rights vested under existing laws or
valid contracts or which creates ~ew obligation or attaches new disabi1i ty to transactions already passed, is invalid as to sales made· :9rior to
Act, but not during period of Act.
This Act was,a1so construed in Weise1·v. Hagdah1 Realty Company, 271
N!Y.S. 629; Bussell v. Wolf, 271 N.Y.S. 639; Managhan,v. May, -273, N.Y.S.
475; New York Life Insurance Company v.H. & J. Guttag CorPoration, 192
N.E. 481, 256 N.Y'. 292, Rev. 272, N.Y.S. 724, .242 A:W. Div. 603; Metropolitan Life Insurance Cqmpany v. Rosenfield, 274 N.y. 531; F.ann~rs' and
Mechanics 1 Savings. ~ of C1 ty of Lock:oort v. Eagle Building Company, .
276 H.Y.S. 246; Kramer v. RelgovR9alty Company, 276, 'N.Y.S. 641.
Law Continuing Foreclosure ACtions
Court may continue foreclosure action!? on mortgages and deeds of
trust for one year. This power.exists only for two'years and only in
specified countieeof the State. (H.B. No. 1458, Laws of 1933, Approved
and Effective May 13, 1933; S.B. No. 135, Laws of 1933, Approved and Effective February 28,'1933,and for two years; H.B. 1287, L~ws of 1933,
Approved and Effect·ive April 24, 1933; and R.B. 1169, Laws of 1933, Approved and Effective May 12, 1933.)

CHC 60263: A-20
Law Abolishing or Limiting Right to Deficiency Judgments
Deficiency judgments abolished in foreclosures and sales under power
of sale in purchase moneY,mortgages, and deeds of trust. (C~pter 36, Laws
of 193::;, Ap:?roved and Effective February 6, 1933.)
Ordinaxy deficiency judgments to be determined by the reasonable
value of the real estate and the mortgagee may prove such reasonable value
by way of defense. (Chapter 275, Laws of 1933, Approved and Effective
April 18, 1933.)
Law Guaranteeing Sale of Property at Fair Price 'in Foreclosure Proceedings
The court may ord~r a resale before confirmation in an action to
foreclose a mortgage on real estate. (Chapter 275, Laws of 1933, A~~roved
and Effective April 18, 1933.)
This Act was construed in Hopkins v. Swain, l74.S.E. 409, 206 North
Carolina 439; Whitiker v. Ch~~e. 174 S.E. 225, 206 North Carolina 335.
Laws Prohibiting or Postponing Foreclosure Actions
On March 20, 1934, the Governor i$sued a proclamation making it 1ll1lawful to oust an owner from his farm home lost through foreclosure wi thout allowing the owner an opportunity to secure the benefits of Federal
(P,rovided for by Chapter 157, Laws of 1933, Approved and
Effe,ctive February 21,-1.933.' Exp"ires' at end of two years.)
: On April 5, 1,93,5, the 'acting 'Governor of the State 'issued the fol'lowing proclamation, tQ, be 'effective until revoked: "Until this Proclamation ,is re,voked, or modi'fied, no judicial, e;x:ecuti ve, or administrative
officer of this State, or of any of the subdivisions thereof, shall entertain any proceeding, or sign any order or other document of any kind 'I'rhich
has for its purpose, or which tends to promote, the transfer or change of
ownership, title to, equities in,' or possession, of real or personal property, contrary to the wishes and needs of the owner or possessor of such
property or of rights of equi ties therein. Providing, that such proceedings may be entertained, or order or other document signed upon satisfactory showing first made to such office, that such owner or -possessor has
the legal right and has been given reasonable opportunity to avail himself of the remesiies' provided under the' terms, of Senate BillUo. 23,
known as the legal'mora~orium, as recently approved, or un~er the terms
of the Frazier-Lemke .Amendment to the .:Bankruptcy Act, and has freely and
voluntarily waived' the bEmefits of such remedies, or has unreasonably refused to avail himself thereof. Any person' injured or feeling aggrieved
by the operations or prov~slons of this Proclamation is authorized to
file his peti tion for relief at the Governor's office."

CHC 60263: A-21
NORTH DAKOTA (Continued)
Foreclosure of real estate mortgages by advertisement are abolis~ed
exce7)t on mortgages held ,by the State or by the University. (Chapter 158,
Laws of 1933, Approved and Effective March 4, 1933)
Hearings are required prior to the confirmation of sales in foreclosure vroceedings, and courts given power to extend of the mortgage
and postpone foreclosure proceedings,. (S.B. 23, Laws of 1935, Approved
and Effective March 9, 1935.)
Laws Extending Redemntion Period
Tne period within which a mortgagor or judgment debtor may redeem
from a mortgage foreclosure or. execution sale of real estate, but for which
a deed has not been issued, is extended for a period of two years from February 21, 1933. (Chapter 157, Laws of 1933, Approved and Effective February
21, 1933)
Redemption periodis extendec;l. to not later t~ July 1, 1937. (S.B.
23,Laws of 1935,' Approved and Effe~tive March 9, 1935) In State ex reI.
Cleveringa v. Klein (N.D. Sup. Ct., June 12, 1933), 249 N.W. 118, it was
held that the statute (Chapter 157, Laws of 1933) shortening or extending
period of redemption from real estate mortgage foreclosure sale is "i;:roairment of obligation of contract" as to mortgages existing at time of enactment of statute. Also deprives holder of mortga5~ executed prior to passage of statute of property without due process. (Constitution, N.D~,
Section 13) Statute extending period of redemption from real estate mortgage foreclosure sale, which statute by its own terms was to expire in two
years, held valid governing mortgages executed and foreclosed during period
of its operation.
Laws Limiting Right to Deficiency Judgment
In actions for the foreclosure of mortgages, the court shall have no
power to render a deficiency judgment.' . (Chapter 155, Law!i3 of 1933, .A.,nproved and Effective March 7, 1933, EX'Pires at the end of two years. Repealed by S.B. 23, Session Laws of 1935, Approved March 9, 1935)

Law Postvoning Foreclosure Proceedings
Proceedings to foreclose a mortgage or enforce a spectfic lien may be
not later than April 1, 1937. This Act applies only to mortgages
executed prior to May 18, 1933. (H.B. 30, Regular Session, 1935, Effective
Feb~~ry 4, 1935, Amending Sections 11, 588 of the ,General Code, as ~ende~
by R.B. 144, December 12, 1934; and re-pealing Sections 11, 588 of the General
Code as ~ended by H.B. 219, May 15, 1933, and H.B. 144, December 12, 1934.)


CHC 60269: A-22
Laws Postponing Foreclosure Proceedings
In pending or future .. actions for foreclosure of mortgages or other
liens u~on.real estate, defendant shall not be req~ired to answer until
thE;l expiration of nine months from service of sunmons or if answer has
been filed, no trial shall be held for nine months. (Chapter 16, S. :B.
No. 76, Laws of 1933, Approved and Effective March 7, 1933, Expires at
end of two years.)
This Act was held unconstitutional as it ·affects actions pending at
its effective date St~te ex reI. Osage County Savings and Loan Association v. Worten, 29 P. (2d) 1.
For two years after the' approval of this Act, the court is vested
with discretion of granting a continuance in all actions to foreclose
mortga[,"es or deeds of trust. (Same Statutory citations given above.)
~lis provision of the Act was held constitutional as it allows ju~
dicial discretion in the gr~ting of.continuances; but it is unconstitutional in an arb~trary and capricious extension of time for nine months
in all cases. State ex reI. Roth v. Waterfield, 29 P. (2d) 24, rehearing denied, 29 P. (2d) 24.

Law Postponing Foreclosure. Decree
Th.e Legislature, by a jOint resolution, advised courts of equi ty not
to decree foreclosure where the mortgagor is making a bona fide effort to
pay. (H.J. Res. 18, Regular Session, 1933, Effective Ma~ch 2,193:3.)




The Court uf Common Pleas is vested with power to stOlfWrits of Execution for the sales of dwellings or farms to prevent serious inequity.
Provisions of this Act not anplicable to mortgages Ullder Title II of the
National Housing Act. (P.L. 827,Act Qf May 18, 1933, Effective May 18,
1933, extended by H.B. 233, Laws of 1935, Effective March 28, 1935, to
continue in force until MarCh 31, 1937.)
Law Insuring Sales of Property at Fair Value in Foreclosure Proceedinr-:s
Procedure is provided for·courts to determine fair value of


ClIC 60263: A"'23
to be sold at foreclosure 'sales.' (Act No. 59, Laws of 1933, Effective
Janu..'1.ry 17 t 1934, to continue in-force Until July 1, 1935.) Construed .in
Market St:reet l-Tational Bank, etal., v. Huff ,et al., Pa. Sup. Ct., E. D.,
June 29, 1935; and Evans v.' Provident Trust Co. of Philadelphia, Pa. Sup.
Ct., E. D., June 29, ~935. Deficiency Judgment Act of 1935 is constitutional as a reasonable remedial act. - Ridge Allen Building & Loan Asnociation v. Leshefko, 24 D. & C. 703.

lTo emergency mortgage moratorium legislation has been enacted in

stat? •


Laws Postponing Foreclosures
Co~rts of the State are empoWered to stay foreclosure suits.
of Conciliation appointed to effect settlements iIf mortgage case:::;. (Act
No. 823, Laws of 1934, Effective March 2, 1934, Expires after two yearn:
extended 18 months from April 10, 1936, by Act No. 303, H.B. 811, Act of
1936, Effective A;pril 10, 1936.)

Laws Limi ting Rig..'h.ts to De,;fic1ency Judgmen1
When a personal judgment is asked, any defendant may, wi thin 90 days
after sale of mortgaged pro'!)6rty, 'apply for an order of apprai sal of true
value. If the valu.e is in excess of the ~eficiency after' application of
the net proceeds of sale, the judgment is extinguished and if the returned
value, after deduction of the ~ale price, is less than the deficioncy, the
deficiency is deemed paid, 'Pro-tanto, and is enforceable for only tho remainder. (Act 264, Laws of 1933, Approved and Effective May 2, 1933.)
Law Susnending Foreclosure Actions
Foreclosures by advertisement may be sus~ended by court when so requested by mort~agor. (Chapter 135, Laws of 1933, Approved and Effective
March 11, 1933.)
This Act held valid in State ex reI. N.W. Mutual Life Insurance Co.
v. Circuit Court (S.D., S. Ct., July 7,1933.),249 N.W. 631, since there

CHC 60263: .A-24
SOUTH DAKOTA.' (Con tinu~91
remains sufficient remedy on contract which secures all substantial riGhts
or parties. The· Act simply restricts the conditions under which the power
of foreclosure by sale· might be exercised. Statute held to cover mortgages in existence at the time of its passage.
Laws Extending Redem-ption Period
3edemption period may be extended for an additional year in mortgage
foreclosure proceedings if mortgagor pays: (1) all taxes due, (2) interest
on mortgage at sale date (3) 7% interest for one year from sale date u~on
total amount of sale (4) interest upon principal of mortgage for one year,.
in adva~ce at rate originally provided for in mortgage before maturity, and
(5) foreclosure costs. (Ch~~ter 137, Laws of 1933, Effective June 2, 1933.)
This law does not ~pply to mortgage joint stock land batik orunder Federal Farm Loan Act. - Ellingson, et al., v. Iowa Joint
Stock Land Eank, S. Dak. Sup. Ct •• January 10, 1936.


Tr~ mortgagor may file a petition.with the Circuit Court prior to the
expiration of the normal redemution -period, and secur~ an extenston or such
period to not later than March-I, 1937. The Act does not apply to mgrtgages held by the Stat~, the United States, or agency, to obligations ~ar­
anteed by the United States, or to mortgages held as security for a public
debt or deposi t. (H.E. 20, Laws of 1935, A;pproved and Effective March 2,

Law Abolishing Deficiency Judgments.
Deficiency judgments abolished. (Chapter 138, Laws of 1933, Effective
May 28, 1935, as amended by H.E. 109, Laws of 1935, Effective February 27,
Law Effecting Mortgage Contract in General
All contracts between mortgagors and mortgagees are unenforceable and
unrecordable if containing: (1) pledge or assignment of right to possessior
of homestead, etc., property prior to expiration of redemntion period;
(2) agreement for mortgagor to pay taxes; (3) waiver of exemptions; (4:) consent to receivers' appointment; howeve:r.-, these provisions are not applicable
to any mortgage executed to the United States or any instrumentality thereof. (H.B. 27, Laws of 1935, Approved and Effective March 16, 1935.)

No emergency mortgage moratorium legislation has been enacted in this
State, as liberal prOVisions for redemption is provided by present legislation.

CHC 60263: A-2,5



Foreclosure Proceedings

Courts empowered to grant stass of proceedings in suits for the
recovery of real property or foreclosure of liens or mortgages on real
pro1Jerty, 180 days from the effective date of the Act or
pending when the .Act becomes effective. The extension shall last for
180 days, but the court may, upon further application at the end,of the
first extension period, but not after 200 days from the effective date
of the Act. grant further extensions, but not beyond May 1, 1934.
(Ch~~ter 102, Laws of 1933, Effective May 1, 1933. Expires after 200
Tho Act is unconstitutional in that it impairs 'the obligation- of
contracts executed before its effective date. Life Insurance Company
of Virginia v. Sanders, Texas Circuit Court of Civil Appeals, El Paso
Division, 62 S. W. (2d) 348.
The Act is consti tutional and is liThe lawful eX8rcise of legi timate Govcrrunental powers" in the interest of public welfare in the time for the sale of land under a deed of,trust. Lingo L~ber
Company v. Haynes, 64 S. W. (2d) 835. This Act was also construed in
SQuth Texas Bank and Trust Company v. Cocke, 72 S. W. 650; Knox v.
Morrison, 66 S. W. (2d) 384; Mountain Townsite Company v. Cooper, 63
S. W. (2d) 1050.

The entire Act was held unconstitutional in Murphy, v. Phillips, 63.
S. W. (2d) 404. Rehearing in this case was denied October 4, 1933; HoWever, a contrary decision was reached in Beaumont Petroleum Syndicate v.
Brossard, Texas Court of Civil Appeals, 9th District, ~ovember 2, 1933.
Court may grant continuances and stays of execution until February
1, 1935, where neither the indebte~~ess nor the lien securing same has
been renewed Qr created since May 1, 1933. (S. B. No.3, Second Soecial
Session, 1934, Approved and Effective February 28, 1934, Expires February 1, 1935.)
T'nis "Moratorium Act" violates Section 16 of Article 1 of the Constitution of Texas, which prohibits the enactment of laws impairing the
obligation of contracts. T:rave1ers Insurance Company et a~,v. Marshall
et al lt .76 S. W. (2d) 1007. This Act also construed in Glenn v. Jones,
73 S. W. (2d) 1072; Glenn v. Ho11ums, 73 S. W. (2d) 1058; Dallas J~int
Stock Land Bank v. Ballard et 0.1., 74 S. W. (2d) 297; Oppenheimer v.
Haley, 72 S. W. (2d) 411; Williams v. Holmes. 74 S. W. (2d) 1040; Brown
v. Lubfock Development Corporation, 75 S. W. (2d) 319.
Law Limiting Right to Deficiency


In suits to collect deficiency judgments rendered after foreclosure
proceedings, defendant allowed to plead as a defense that the propert~r
was sold for less than its actual value. The actual value may be s~own

CHC 60263: A-26
TEXAS (Continued)
and the defendant is entitled to a credit of any difference between its
actual value and the sale price of the property. Any action to enforce
deficiency judgment must be begun within six months from the date of
sale. (Chapter 92, Laws of 1933, Effective April 21, 1933.)
~nis anti-deficiency judgment law violates Section 16, Article 1,
of the Constitution, which prohibits legislation, im.pairing the obligation of contracts. Langever Vi Miller, 76 S. W. (2d) 1025.

No emergency mortsage moratorium legislation has been enacted in
this State. However, Code of State provides that Court, in its discretion, may grant stay of execution on judgments.

Law Postponing Execution or Foreclosure Sales
Court empowered to stay execution or foreclosure sales for three
months. (No. 30, Laws of 1933, Effective March 24, 1933; Expired March
1, 1936, unless by joint resolution or proclamation of the Governor the
emergency is considered terminated before said date; as amended by Laws
of 1935, H.B. No. 108, Effective February 28, 1935, extending moratorium
until March 1, 1937.)
Law Extending Period of Redemption
Court within its discretion and forlthe benefit of the parties concerned may extend the period of redemption. (Same Statutory citations
as above.)

No emergency mortgage moratorium legislation has been enacted in
this State. However, the Court in its discretion may fix an equitable
redemption period as justified by all the surrounding circumstances of
~o emergency mortgage moratorium legislation has been enacted in
this State. However, redemption provisions of present foreclosure laws
are rather lenient.

CRC 60263: A.-27

No emergency mortgage moratorium legislation has been enacted in
this State.

Law Postponing Foreclosures
Sales in foreclosure action on any farm or homestead commenced
prior to March 1, 1935, may~ within the discretion of the court, be
prohibited for a reasonable period not to exceed two years beyond the
usual one year period, but ,not beyond March 1, 1938. At all. times,
motion for confirmation of sale shall be made only on notice given by
plaintiff to mortgagors. (Chap. 11, Laws of 1933, Approved and Effective February 17, 1933; Chap. 125, Laws of 1933, Approved May 15,
Effective May 17, 1933; Chap. 474, Laws of 1933, Approved and Effective
July 29, 1933, as amended and repealed in part by Laws of 1935, Chap.
319, Effective August 2, 1935{ Expires April 1, 1937, and Chap. 449,
Effective September 13, 1935.)
Construed in Foelske v. Stockhouser, 254 N.W. 340; First'National
Bank v. W. J. Durham Lumbel' Co., 256 N. W. 783.
Law Extending Redemption Period,
Period of redemption may be extended not later than April 1, 1938,
where mort~ge foreclosed and redemption period has not expired, or
where sale occurs after August 2, 1935, in such foreclosure action, now
pending, or begun before April 1, 1937, or on sale where redemption
period has not expired, or where such sale occurs after August 2, 1935,
and before April 1, 1937. (Laws of 1935, Chap. 319, Effective August
2" 1935, Expires April 1, 1937, as amended by Laws of 1935, Chap. 547,
Effective October 4, 1935.)
Constitutionality uPheld in Mutual Building & Savings Assn. v.
Willing, et al., Wis. Sup. Ct., June 2, 1936.
Local county mediation boards are established to effect compromises
between mortgage debtors and creditors. (See part of above cited Acts.)
In actions for foreclosure or performance of lend contracts where
judgment is entered before April 1, 1937, the court may extend redemption period three years, the defendant paying current interest or taxes
or both. (Laws of 1933, Chap. 301, Effective June 23, 1933, as amended
by S. B. No. 511, Laws of 1935, Chap. 362, Effective August 14, 1935.)

CHC 60263: A-28
WISCONSIN (Continued)
No extension of redemption period permitted unless court directs
mortgagor, owner or judgment debtor to pay taxes and interest. In any
ejection or unlawful detainer action brought prior to April 1, 1937,
against a lessee on a lease of ten years or more, whel~e the lessee has
constructed improvements of more than one-half the land IS value, e:.:ce}')t
leases mentioned in Sec. 234.19 court may allow redemptio~ period of one
to three years. (Laws of 1935, Chap. 482, Effective September 20, 1935.)
Law Limiting Bight to D3ficiency Judgment
Before sale in foreclosure action, in which jud@nent is rendered
prior to January 1, 1938, court must exercise its equitable powers and
fix the value of the mortgaged premises. (Chap. 13, Laws of 1933,
Approved February 23, 1933, Effective February 25, 1933.)

No emergency mortgage moratorium legislation has been enacted in
this State. However, execution on judgment is within the discretion
of the Court.

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