For Rhode Island Real Estate Professionals

Mortgage foreclosure: bring the statute up to current practice

Rhode Island foreclosure is overwhelmingly non-judicial. A lender exercises the statutory power of sale, publishes, mails, auctions on the courthouse steps or the front lawn, and delivers a foreclosure deed. There is no judge in the ordinary case. That makes the statutory formalities the only protection a homeowner has, and it makes those same formalities the only thing standing between a subsequent buyer and a clouded title.

So the formalities had better be clear. Right now they are not.

Start with the fact that the chapter contradicts itself in the field

That is a small thing and a perfect example of the whole problem. A servicer in Texas is trying to comply with a Rhode Island statute by following a Rhode Island regulation that points at a repealed section. Somebody eventually litigates it. Somebody’s title is unclear in the meantime. Cleaning that up costs the state nothing and requires no philosophical debate. It just requires a legislator who reads the chapter.

Four changes I will push

1. A statutory surplus procedure with a deadline and an accounting

When a power-of-sale foreclosure produces more than the debt, costs, and fees, that surplus belongs to the junior lienholders and then to the former owner. Everyone agrees on that in principle. What Rhode Island lacks is a clean statutory mechanism specifying who accounts for it, to whom, in what form, and by when — with a recorded accounting and a hard deadline. In practice the money sometimes sits, sometimes gets interpleaded, and sometimes the former owner never learns it existed. A homeowner who just lost the house should not have to hire a lawyer to find out whether there is money owed to them.

2. Notice requirements that match how people actually receive notice

The publication and mailing scheme in § 34-27-4 and the advertisement requirements in § 34-27-5 were built around a newspaper-reading public. Keep publication — it has real value as a public record and it protects the sale. But the mailing side needs teeth: proof of mailing filed with the deed, notice to every party of record, and a clear rule for what happens when a mailing comes back undeliverable. A foreclosure should not be voidable years later because nobody can prove what was sent, and it also should not be valid when the owner demonstrably never got notice.

3. A complete recorded chain before the sale, not after

The entity foreclosing should be the entity of record, with every assignment recorded before the notice goes out. This is not an anti-lender position. It is a title position. Assignment gaps papered over after the fact are the single most common defect I see in foreclosure chains, and they surface years later, at somebody else’s closing, to somebody who did nothing wrong.

4. A curative statute that protects equity and title

This is the hard one, and it is where most reform proposals go wrong by picking a side.

Right now a defect in a completed foreclosure can be raised on an open-ended timeline. That is good for the wronged homeowner and terrible for title certainty, and the person who eats the uncertainty is usually a bona fide purchaser three transactions downstream who never had any way to know. But simply slamming the window shut abandons people who were genuinely wronged.

The right answer is to split the remedy from the title. Define a reasonable window in which a defective sale can be challenged as to title. After that window, a bona fide purchaser for value takes free and clear — but the wronged party keeps a damages claim against the foreclosing party and its agents, and the statute says so explicitly. The homeowner keeps a real remedy. The innocent downstream buyer keeps a marketable title. The party that has to be careful is the party that actually controlled the process, which is exactly where the incentive belongs.

Tax sales: Rhode Island lets the equity disappear, and only the General Assembly can fix it

Start with how a Rhode Island tax sale actually ends, because most people — including most people who vote on this — have never traced it all the way through.

Follow that through. A purchaser acquires a tax title for a few thousand dollars in unpaid taxes, interest, and fees. A year passes. The right of redemption is foreclosed. Title becomes absolute. That purchaser now owns a property that may be worth two hundred, four hundred, six hundred thousand dollars — and the former owner’s equity is simply gone. Not held for them. Not accounted for. Gone.

Chapter 44-9 does contain a surplus mechanism at § 44-9-37, but it governs a municipal sale without foreclosure. It does not reach the ordinary path that most tax titles in this state actually travel. That is the gap, and it is a real one.

Here is the part that matters for how this gets fixed. In Rhode Island the property does not end up with the town. It ends up with a private purchaser who bought the tax title at the collector’s sale. That structural fact is why nobody should sit around waiting for a court to solve this on somebody else’s facts. Rhode Island’s scheme is its own animal, it has not been reformed, and the fix is legislative. That means it takes a bill, and it takes somebody in the building who has actually litigated one of these.

What I will push on tax sales

• An equity-protective disposition. Where foreclosure of redemption would extinguish substantial equity, the statute should require that the surplus be determined and returned to the former owner — whether by requiring a sale and accounting, or by conditioning the decree on payment of the excess above the debt, interest, costs, and a reasonable return to the tax title holder. Investors who front municipalities their delinquent tax revenue are performing a real service and are entitled to be paid well for it. They are not entitled to the whole house.
• Certainty in the redemption amount. When the tax title holder and the party redeeming cannot agree on redemption costs, the process can stall and a certificate of redemption may not issue — which can cost someone a property over an arithmetic dispute. There should be a defined procedure to fix the amount, deposit it, and redeem, with the dispute resolved afterward rather than as a precondition.
• Fix the pleading trap. Rhode Island case law has strictly construed the requirement that an interested party assert the statutory right of redemption under § 44-9-29 even when that party is contesting the validity of the tax title under § 44-9-31. Losing real property because of how a responsive pleading was framed is not a policy anyone would defend if you proposed it out loud. It should be cured by statute.
• Real pre-sale notice to owner-occupants. Publication and a mailing to the address of record is thin protection for an elderly owner-occupant who has stopped opening mail. The consequence here is total and permanent; the notice should be proportionate to that.

The conveyance tax, and the part people keep missing

Everyone in the business knows the rate went up. Fewer people have internalized how the second tier actually works, and I am still correcting it at closings.

Tier 1 — every transaction

Tier 2 — the stamps double above the threshold

Two things practitioners get wrong. First, the second tier is not retroactive to dollar one — it applies only to the portion above the threshold, so a sale at $801,000 is not a catastrophe. Second, and more consequential going forward: the threshold moves. For tax years beginning on or after January 1, 2026, § 44-25-1(b) indexes the $800,000 figure to CPI-U, measured as of September 30 of the prior year, compounded annually, rounded up to the nearest $5 increment, and it can never go down. The Rhode Island Association of Realtors has reported the adjusted 2026 threshold at $824,000. Do not quote a threshold from memory at a closing — confirm the current-year figure with the Division of Taxation.

Run the math

The Division of Taxation’s own published example: on a residential sale of $800,500, Tier 1 is $6,003.75 and Tier 2 applies to the single $500 above the threshold for $3.75, totaling $6,007.50.

Scale that up. On a $1,000,000 residential sale at the $800,000 statutory threshold, Tier 1 is $7,500 and Tier 2 is $1,500, for $9,000. Under the pre-October 2025 rates the same closing carried roughly $5,520. That is about $3,480 of new cost on one transaction, and the seller pays it unless the parties agree otherwise.

I opposed this increase and I will work to roll it back. But the immediate practical point is simpler: know how the two tiers stack, know that the threshold indexes every January, and put the current figure on your net sheets rather than last year’s.

The rest of the portfolio

Land use and development

The recent wave of state housing legislation moved a great deal of authority from local boards to state mandate. I represent applicants in front of planning and zoning boards, and I will say plainly that some of what those boards did needed fixing. That is not an argument for replacing local judgment with a formula written in Providence and applied identically to Scituate and to a city block. Predictability, real timelines, and a functioning appeal path matter more to a developer than any particular density number — and those are achievable without stripping towns.

Brokerage and licensing

I testified before the Senate on 2026-S 3136, relating to real estate brokers and salespersons, before I ever ran for anything. Licensing law, agency disclosure, commission structure, and the practical mechanics of how a transaction gets papered are areas where the industry’s actual experience should reach the committee room. Right now it mostly does not, and bills get drafted by people who have never held a license.

Landlord and tenant

Most Rhode Island landlords are not institutions. They own one, two, or three units, often inherited, often in the same town they live in. Policy that treats every landlord as a hedge fund drives exactly those small owners out of the rental market, and their units are the affordable ones. Tenants need real protection against genuinely bad actors. Small owners need a process that does not take six months and a lawyer to resolve a straightforward nonpayment. Those two things are not in conflict, and pretending they are is how we got here.

Investment and tax sale purchasing

Nothing above is anti-investor. Clear rules are worth more to a serious buyer than loose ones, because loose rules mean litigation risk priced into every bid and title insurance carriers taking exceptions. A tax sale regime that returns surplus equity and produces clean, defensible title is a better market to invest in than the one we have.