It was indeed a Happy New Year’s for California homeowners! On January 1, 2013, the California Homeowners Bill of Rights went into effect, giving homeowners more foreclosure rights. This new bill protects homeowners and is designed to ensure fair lending and borrowing practices, particularly during the foreclosure process.
This new law was passed to help homeowners avoid foreclosure, make applying for
loan modifications easier and fair, and stay in their homes. Some of the most important provisions include:
- Prevention of “Dual Tracking”: While a loan modification is in progress, mortgage services are prohibited from continuing the foreclosure process. Dual tracking occurs when homes are put on the foreclosure track even though a loan modification is still under consideration. The CA Homeowners Bill of Rights prevents dual tracking. Homeowners who have submitted a complete loan modification application must get an answer (with an explanation for the decision) before the foreclosure process can being or continue. Furthermore, the mortgage servicer cannot record a Notice of Sale on the home until the homeowner is provided with a decision on the loan modification application.
- Guaranteed Single Point of Contact: Homeowners must be given a guaranteed single point of contact (a person or a team at the bank) who is familiar with their case, has their paperwork, and can get them a decision about their loan modification application. This makes the process more efficient for homeowners, so that they are not transferred from department to department.
- Document Verification: Prevents lenders from “robo-signing.” Any lenders that are found to have fraudulently signed mortgage documents will have civil penalties imposed. All mortgage documents must be verified and failure to do so will bring about civil prosecution.
- Tenant Rights: Buyers of foreclosed homes must give tenants living in that home at least 90 days before starting the eviction process.
- Enforcement Rights for Homeowners: Borrowers will have the authority and the right to enforce this new bill if there have been material violations. Injunctive relief will be available before the foreclosure sale and damages may also be recovered following a sale.
In 2012 alone, there were over 200,000 foreclosure in California. Riverside and San Bernardino counties have the highest foreclosure rates in the state. The CA Homeowners Bill of Rights gives power to homeowners across Southern California and may help you prevent your foreclosure. This new bill ensures fairness and transparency throughout the foreclosure process.
Know your rights. If you fee like you are being violated, or would like some more information, please contact Atlantis Law LLP. We will help you stay in your home.