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California Homeowners Bill of Rights – Will it Pass?

California Attorney General Kamala Harris is in the news with the controversial Homeowner Bill or Rights. What does it all mean? How will it affect California homeowners and will it impact fraudulent foreclosures? There is a lot of support for the bill and Harris is pressing hard – this issue has been front and center for Harris her entire two years in office.

Let’s dig in, take a look and give you a quick overview. Bottom line: the California Homeowner Bill of Rights is meant to protect California homeowners from unfair and sometimes aggressive practices by banks and mortgage companies. Harris’ believes that the Homeowner Bill of Rights will help consumers and communities better cope with the state’s urgent mortgage and foreclosure crisis.

Harris states“It’s not about bailing people out. It’s not about giving them a handout, it’s simply saying, ‘Let’s have clear rules so that if you want to follow the rules, you can actually succeed.'”

Industry analysts predict that the nightmare in the California housing market is far from over. The bill is aimed at stemming the loss of homes and providing transparency in dealing with banks and mortgage institutions. Harris has made it clear that one of her main missions is to protect homeowners and it hasn’t been easy to pass legislation, or sort the mess out.

The aim is to keep lenders from foreclosing on California homeowners while negotiating a loan modification on the property. Ideally the law will also simplify loan documentation and establish a standardized contract for foreclosures as well as loan restructuring.

Like any legislation, there are many ‘moving parts’ but another piece of the law would require banks to provide homeowners with one single point of contact during a loan modification process and would penalize banks $25 every time the register a default loan. The default fees would be pooled to fund mortgage fraud investigations. Again, there are a lot of parts to the law and it’s impossible to say which pieces will stay standing and which may be negotiated away.

Too many people are losing their homes and many lawmakers feel they have to stem the tide and reverse the trend thereby turning the tide of the crisis and getting California back on an even fiscal keel.

While the battle rages on, we still see the short sale as a viable and timely solution for California homeowners who have their backs against the wall and want (or need or must) get out from under the burden of a house they can no longer afford.

We successfully structure short sales every day of the week, helping homeowners breathe a sigh of relief, and maintain their dignity while keeping their credit rating intact. We’ll keep our eye on the Homeowners Bill of Rights and we’ll do our best to help sort out the details. In the meantime, if you have a client who could benefit from a short sale, let’s talk. We can help simplify the process, get the deal closed and make everyone happy. There’s some win-win-win news for you.

 

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