The Oregon legislature did something kind of cool that didn't make the news.

Remember reading about the change in the foreclosure statute where foreclosing lenders have to contact the owner and discuss options, including loan modifications? I know that part. What I didn't know, though, is that if an owner receives a Notice of Default and he or she contacts the lender, the process is stayed for a time. I liked that.

The other change--and this is kind of huge--has to do with "piggyback" mortgages. That's the name for the 80-20 loans, 90-10's, atc., where the owner takes out of small second mortgage along with the first to buy a home. Some had speculated that the second in this instance might be protected from a deciciency judgment, but it was not 100% clear.

The old foreclosure statute  had said that purchse money mortgages--the mortgage used to buy a house--was exempt from deficiency actions.  This was interpreted as meaning only first mortgages. The 2009 foreclosure statute offers clarification by saying that the second in a piggyback situation may be a purchase money mortgage and therefore exempt.

I'm not a lawyer and don't take this as legal advice.  Contact an attorney for complete analysis.