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    According to the Center for Responsible Lending, over the last five years “California has led the nation in foreclosures, with more than 785,000 homes lost, and another half-million already in the foreclosure process.” As of January 1, 2013, California homeowners may benefit from a new law entitled the California Homeowner Bill of Rights that protects them from wrongful foreclosures and unethical practices by lenders.

    The California Homeowner Bill of Rights is designed to ensure that homeowners are considered for, and have a meaningful opportunity to obtain, available loss mitigation options, such as loan modifications or other alternatives to foreclosure. Essentially, the new law brings into state statute some of the key elements of the National Mortgage Settlement Agreement. However, unlike the National Mortgage Settlement Agreement which only dealt with the five largest lenders, the new law adds protections to deal with all servicers – not just the big five.

    The California Homeowner Bill of Rights applies only to first lien mortgages that are secured by owner occupied, 1-4 unit properties. It does not cover borrowers in an active bankruptcy nor does it give borrowers a right to a loan modification.

    In a nutshell, the California Homeowner Bill of Rights imposes the following requirements on most lenders and servicers:

    • It curbs “dual tracking” where loan servicers put homeowners on the foreclosure track, even when loan modification applications are under consideration;
    • It facilitates better communication between borrower and loan servicers by requiring loan servicers to provide an accountable, constant point of contact to help homeowners through the loan modification process;
    • It requires enhanced notification so that borrowers will know their rights and about the opportunity to apply for a loan modification;
    • It requires lenders to provide proper documentation before they can foreclose; and
    • It gives borrowers the right to sue for an injunctive relief, damages and attorney fees if there is a material violation.

    If you or someone you know suspect your lender is violating the Homeowner Bill of Rights, contact Pascuzzi, Moore & Stoker to enforce your rights under the new laws.

     
    Pascuzzi, Pascuzzi & Stoker
    2377 W. Shaw Avenue, Suite 101
    Fresno, California 93711
    Phone: (559) 227-1100
    Fax: (559) 227-1290
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