California's Homeowner Bill Of Rights: Law And Protections

The California Homeowner Bill of Rights is a set of laws that provide protections to homeowners facing foreclosure. It became law on January 1, 2013, with many sections renewed and modified as of January 1, 2019. The bill was introduced on February 29, 2012, and signed into law by Governor Edmund G. Brown Jr. on July 11, 2012.

The law came into effect on 1 January 2013

The California Homeowner Bill of Rights came into effect on 1 January 2013. The bill was signed into law by Governor Edmund G. Brown Jr. on 11 July 2012.

The bill was introduced on 29 February 2012 at a press conference featuring Assembly Speaker John A. Pérez and Senate President pro Tem Darrell Steinberg. The bill was created in response to the state's foreclosure and mortgage crisis. It aimed to provide protections for homeowners and reforms to the mortgage and foreclosure process.

The bill consists of a series of related bills, including the Foreclosure Reduction Act and the Due Process Rights Act. The key provisions of the bill include restrictions on dual-track foreclosures, guaranteed single points of contact for struggling homeowners, and civil penalties for fraudulently signed mortgage documents.

The California Homeowner Bill of Rights applies to first-lien mortgages on owner-occupied homes with no more than four units. The bill provides protections for homeowners facing foreclosure, including notification of foreclosure-prevention options and restrictions on fees.

The bill also enhances law enforcement responses to mortgage and foreclosure-related crimes and provides additional protections for tenants in foreclosed homes.

It protects homeowners facing foreclosure

The California Homeowner Bill of Rights (HBOR) is a set of laws that provide protections to homeowners who are facing foreclosure. It became law on January 1, 2013, with many sections renewed and modified as of January 1, 2019.

The HBOR offers several protections for homeowners facing foreclosure. Here are some key provisions:

Notification of Foreclosure-Prevention Options

Your loan servicer must attempt to contact you at least 30 days before initiating the foreclosure process. During this contact, they will discuss your financial situation and explore alternatives to foreclosure. After this, the servicer can start the foreclosure process by recording a notice of default in the county where your home is located and will send you a copy within 10 business days. Within 5 days of recording the notice of default, your servicer must also provide information about options to avoid foreclosure.

Guaranteed Single Point of Contact

If you request a loan modification or other foreclosure prevention option, your servicer must assign you a specific person or team who will guide you through the application process. This includes helping you understand the requirements and deadlines, informing you of any missing documents, and providing updates on the status of your application.

Acknowledgment of Application

If you apply for a loan modification, your servicer must notify you within five business days of receiving your application if there is any missing information, errors, or deadlines for completion.

Restrictions on Fees

You cannot be charged a fee for applying for a loan modification. Additionally, you will not incur late fees while your servicer is reviewing your completed loan modification application, during the appeal process of a denial, or while you are making timely payments under an approved modification.

Restrictions on Dual Tracking

Your servicer must pause the foreclosure process while reviewing your completed loan modification application and during the appeal period of a denial. They cannot foreclose on you if you are complying with the terms of an approved loan modification, forbearance, repayment plan, or other foreclosure prevention options.

Denial Rights

If your loan modification application is denied, your servicer must provide the reasons for the denial in writing and inform you of other possible foreclosure prevention options. You have the right to appeal the denial and submit a new application if your financial situation has materially changed since your previous application.

These provisions of the California Homeowner Bill of Rights aim to protect homeowners facing foreclosure by ensuring they receive proper notification, assistance, and a fair opportunity to explore alternatives to foreclosure.

It restricts dual-track foreclosures

The California Homeowner Bill of Rights became law on January 1, 2013, with many sections renewed and modified as of January 1, 2019. The bill was introduced on February 29, 2012, and was signed into law on July 11, 2012.

Dual-tracking occurs when a servicer simultaneously reviews a borrower for a loan modification or other foreclosure avoidance alternatives while also proceeding with foreclosure. The California Homeowner Bill of Rights prohibits dual-tracking. This means that if a borrower submits a complete application for a first lien loan modification at least five business days before a scheduled foreclosure sale, the servicer cannot record a notice of default, notice of sale, or conduct a trustee's sale while the application is pending. The servicer must also pause the foreclosure process while it is making a decision on a completed loan modification application and until after it gives the borrower time to appeal a denial.

Under the bill, servicers must also provide pre-foreclosure help to borrowers. They must try to contact the borrower at least 30 days before starting the foreclosure process to discuss their financial situation and explore options to avoid foreclosure. This initial contact must be in person or by telephone, and the servicer must advise the borrower of their right to request a subsequent meeting. During the initial contact or at the subsequent meeting, the servicer must give the borrower the toll-free telephone number of a HUD-certified housing counseling agency.

The California Homeowner Bill of Rights also includes the Due Process Rights Act, which guarantees a reliable single point of contact for struggling homeowners to discuss their loan with. This single point of contact must be an individual or team who can walk the borrower through application requirements and deadlines, knows the status of their application, and can get them a decision.

It guarantees a single point of contact for struggling homeowners

The California Homeowner Bill of Rights was signed into law by Governor Edmund G. Brown Jr. on July 11, 2012, and came into effect on January 1, 2013. The bill provides protections for homeowners facing foreclosure.

One of the key provisions of the bill is the guarantee of a single point of contact for struggling homeowners. This means that if a homeowner requests a loan modification or other foreclosure-prevention option, their lender or servicer must assign them a specific person or team who will be their consistent point of contact. This representative must guide the homeowner through the application process, including explaining the requirements and deadlines. They must also be knowledgeable about the facts and status of the homeowner's application, including any missing documents, and must have direct access to decision-makers. This ensures that the homeowner does not have to repeat their circumstances to a new representative each time they call, saving them time and providing a more efficient and effective experience.

The guaranteed single point of contact also allows the representative to advocate on behalf of the homeowner to the decision-makers, keeping the homeowner informed about the status of their application. This direct access to decision-makers can be crucial in obtaining a timely and favourable decision for the homeowner.

The provision of a single point of contact is intended to bring more transparency and accountability to the practices of banks and lenders in California. It ensures that homeowners have a reliable source of information and assistance as they navigate the complex and often stressful process of loan modification or foreclosure prevention. This provision gives struggling homeowners a better chance of keeping their homes and provides a fairer process for all involved parties.

It imposes civil penalties on robo-signing

The California Homeowner Bill of Rights became law on January 1, 2013, with many sections renewed and modified as of January 1, 2019. The bill is a set of laws that provide protections to homeowners facing foreclosure.

Robo-signing is a practice that involves the repeated filing of foreclosure documents without verifying their accuracy. The California Homeowner Bill of Rights, for the first time, imposes civil penalties on this practice. Here's a detailed explanation of how the bill addresses robo-signing:

Civil Penalties on Robo-Signing

The California Homeowner Bill of Rights includes civil penalties of up to $7,500 for each instance of robo-signing. This means that lenders or loan servicers who engage in the fraudulent practice of signing foreclosure documents without verifying their accuracy can be fined up to $7,500 per occurrence. This provision is designed to deter lenders and servicers from rushing through the foreclosure process without properly reviewing the relevant documents and ensuring their accuracy.

Verification of Documents

The bill also includes a provision that requires loan servicers to review and verify certain foreclosure documents. Specifically, servicers must ensure that documents pertaining to the foreclosure process are accurate, complete, and supported by reliable evidence about the loan, its status, and the servicer's right to foreclose. This provision ensures that homeowners' rights are protected and that foreclosures are carried out in a lawful and orderly manner.

Right to Document Verification

Homeowners are also empowered by the bill to require loan servicers to document their right to foreclose. This means that homeowners can request proof that the servicer has the authority to initiate foreclosure proceedings. This provision gives homeowners a tool to hold servicers accountable and ensure that they are acting within their legal rights.

Enforcement and Protection for Borrowers

The bill includes meaningful enforcement measures for borrowers whose rights are violated. This means that borrowers who are subjected to robo-signing or other unlawful practices have legal recourse. The bill enhances borrowers' ability to access the courts and protect themselves from violations of their rights.

Single Point of Contact

Additionally, the bill guarantees struggling homeowners a single point of contact at their lender. This designated contact must have knowledge of the borrower's loan and provide direct access to decision-makers. This provision ensures that homeowners are not passed around from one representative to another and that they can obtain accurate and timely information about their loan and options for avoiding foreclosure.

In conclusion, the California Homeowner Bill of Rights takes a comprehensive approach to addressing robo-signing and protecting homeowners' rights. By imposing civil penalties, requiring document verification, empowering homeowners, and providing enforcement measures, the bill seeks to deter unlawful practices, hold lenders and servicers accountable, and ultimately help struggling homeowners keep their homes.

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