The Nevada Legislature just completed its bi-annual legislative session. In the past, stakeholders in the real property field (whether lenders, loan servicers, landlords, or trustees) have braced themselves for new surprises the Legislature decides to throw their way. From 2009-2017, the focus was on lenders and loan servicers, who had to manage their way through two incarnations of the foreclosure mediation program, the Homeowner’s Bill of Rights (“HOBR”), and changes to HOA lien foreclosures. Now that the dust has settled, Nevada’s housing market appears to be strong and has returned to levels close to those prior to the economic meltdown of 2008.
Because of COVID, there was an expectation that the Nevada Legislature might try to revisit or add new foreclosure laws. It did not do so. Instead, the focus was primarily on the rental crisis COVID created, which have been mostly on hold since the state of emergency began. The Legislature began addressing this issue in a special session last August when it passed SB 1—a bill to create an eviction mediation program similar to Nevada’s Foreclosure Mediation Program. The bill authorized the district or justice court to assigns mediators who would attempt to resolve rental disputes between landlords and tenants. The bill became law on August 7, 2020. The mediation program is in full swing, and the courts have created a board of mediators.
By the time the Legislature came back to its regular session in February of this year, most evictions were still on hold. This gave the Legislature the opportunity to add new laws to complement the Eviction Mediation Program it created last summer. Ultimately, three major bills passed:
AB 141: This bill requires courts to automatically seal all records of summary evictions granted during the COVID emergency. This bill became law on May 27, 2021.
AB 308: This bill prohibits landlords from charging late fees for leases longer than a week until three days have passed since the rent became due. The bill also requires that landlords provide a 60-day notice of a rent increase for tenancies that are a month or longer and 30 days for a tenancy that is less than one month. The current requirements are 45- and 15- days, respectively. This bill became law on July 1, 2021.
AB 486: This bill makes several changes to the eviction process for a default in payment. Primarily, it allows tenants to claim as an affirmative defense to an eviction that they have a pending application for rental assistance or that the landlord refused to accept rental assistance provided by the tenant. The court is required to stay all proceedings if the tenant asserts these defenses to allow the landlord to rebut them. If the court finds that the landlord failed to accept rental assistance, the eviction would be terminated, and the tenant may be awarded damages. Moreover, landlords are also now required to include with the eviction notices rental assistance options as well as information regarding the tenant’s rights to claim these affirmative defenses. The Legislature added a sunset date of June 5, 2023, to most provisions of the bill. This bill became law on June 4, 2021.
Some bills that failed, but may turn up in a future session include AB 152 (a bill that would have changed Nevada’s law for debt collectors); AB 161 (a bill that would have eliminated summary evictions); SB 144 (a bill that, as originally drafted, would have eliminated non-judicial HOA foreclosures); and SB 159 (a bill similar to one in California that would have allowed tenants or non-profits to bid on properties after foreclosure sales had taken place). Notably, no changes were made to HOBR or the Foreclosure Mediation Program.
In many ways it is not surprising that the Legislature did not make any major changes to foreclosure laws considering the CFPB’s new Covid-related rules and the current procedures in place to provide foreclosure alternatives, such as HOBR and mediations, to homeowners. The Nevada Legislature’s next regular session is not scheduled to begin until February 2023.
About the author
Ramir M. Hernandez, Esq. is an attorney at Wright, Finlay & Zak. He primarily focuses on real property, federal consumer law, bankruptcy, collections, and evictions. He is also a member of the board of the local Federalist Society Chapter.
About this article: This article was originally published in the “Real Estate Law” issue of Communiqué, the official publication of the Clark County Bar Association, (Sep 2021). See https://clarkcountybar.org/about/member-benefits/communique-2021/communique-september-2021/.
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