California Homeowner Bill of Rights Takes Affect
Thanks to a new law foreclosure activity in California appears to be on the decline. This downward trend seems to coincide with the passage of the California Homeowner Bill of Rights (HBR) which took effect in January 2013. The legislature introduced HBR in response to the more than one million homes that went into foreclosure between 2008 and 2011. During that period, the rate of foreclosure sales soared because many mortgage lenders engaged in widespread misconduct and treated homeowners unfairly in the process. The California Homeowner Bill of Rights promises to make the foreclosure process in California fair and transparent to the consumer.
Key reforms contained in the California Bill of Rights
The new law aims to protect people whose homes are in foreclosure by reforming the foreclosure process. As a result, mortgage lenders and servicers must adhere to the following rules:
No Dual-Tracking
Typically, lenders offer a homeowner facing foreclosure a chance to apply for a loan modification. Yet, prior to the law, lenders did not postpone foreclosure while the loan modification application was pending. This process is known as dual tracking. Lenders must decide to grant or deny a loan modification before advancing foreclosure.
Establish a single point of contact for homeowners facing foreclosure
If you fall behind on your mortgage payment it is important to discuss your options with the lender. The HBR requires lenders designate an individual or team that has knowledge of the homeowner’s case, information on alternatives to foreclosure and access to decision makers.
Robo signing prohibited
“Robo signing” refers to a practice where agents of a lender or servicing company sign foreclosure affidavits without having actual knowledge of the mortgage account. The HBR imposes penalties up to $7,500 for each occurrence to ensure that lenders do not falsify records to support a foreclosure.
In addition, the HBR gives homeowners a right to sue lenders for any other violations they commit under the bill. Attorney’s fees may also be recovered.
If you are facing foreclosure let a Los Angeles bankruptcy attorney avert the process and help enforce your rights under the California Homeowners Bill of Rights. The attorneys at the Law Offices of Michael Jay Berger are dedicated to providing quality legal services.
