26-31-112. PROCEDURE FOR RECOVERY. (1) A person who obtains against a mortgage broker, mortgage lender or mortgage loan originator a money judgment in an Idaho court that includes findings of violations of this chapter occurring on or after July 1, 2009, after final judgment has been entered, execution returned unsatisfied and the judgment has been recorded, may file a verified claim with the court in which the judgment was entered, and on twenty (20) days’ written notice to the director and to the judgment debtor, may apply to the court for an order directing payment from the mortgage recovery fund of any unpaid amount on such judgment, subject to section 26-31-111, Idaho Code.

(2) At a hearing on the application, the person seeking recovery from the mortgage recovery fund must show:

(a) That the judgment has not been discharged in bankruptcy and is based on facts allowing recovery under section 26-31-109(2), Idaho Code;

(b) That the person is not a spouse of the judgment debtor, or the personal representative of the spouse;

(c) That the person is not a mortgage broker, mortgage lender or mortgage loan originator as defined by this chapter who is seeking to recover any compensation regarding the mortgage loan transaction which is the subject of the money judgment upon which a claim against the mortgage recovery fund is based; and

(d) That, based on the best available information, the judgment debtor lacks sufficient nonexempt assets in this state or any other state to satisfy the judgment.

(3) Any recovery on the money judgment received by the judgment creditor before payment from the mortgage recovery fund shall be applied by the judgment creditor to reduce the judgment creditor’s actual damages which were awarded in the judgment.

(4) After giving notice and the opportunity for a hearing to the person seeking recovery, to the judgment debtor and to the department, the court may enter an order requiring the director to pay from the mortgage recovery fund the amount the court finds payable on the claim, pursuant to and in accordance with the limitations contained in this section, if the court is satisfied as to the proof of all matters required to be shown under subsection (2) of this section, and that the person seeking recovery from the mortgage recovery fund has satisfied all of the requirements of this section.

(5) When the director receives notice that a hearing is scheduled under this section, the director may enter an appearance, file a response, appear at the hearing or take any other appropriate action as he deems necessary to protect the mortgage recovery fund from spurious or unjust claims and to ensure compliance with the requirements for recovery under this section.

(6) If the court finds that the aggregate amount of claims against a mortgage broker, mortgage lender or mortgage loan originator exceeds the limits set forth in section 26-31-113, Idaho Code, the court shall reduce proportionately the amount the court finds payable on the claim.

(7) The department shall provide the court with information concerning the mortgage recovery fund necessary to enable the court to carry out its duties under this section.

History:

[26-31-112, added 2009, ch. 97, sec. 2, p. 287.]