A new law, effective January 1, 2013 will help to protect
distressed homeowners from losing their homes.
The California Homeowner Bill of Rights is aiming to help avoid
foreclosure wherever possible in an effort to stabilize California’s housing
market.
Most of us have heard stories of a home being foreclosed
upon while the homeowner was in the middle of a loan modification or short
sale. One of the reasons for this was
that the bank representative and the foreclosure department were not
communicating with each other at all.
The homeowner felt "safe" because they were communicating with
the bank on a regular basis.
Unfortunately, because the different departments of the bank were not
speaking to each other, the result was that the home foreclosed.
This new law will
generally prohibit lenders from engaging in this practice which is referred to
as dual tracking. The best part of the new law, in my opinion,
is that it provides for one single point of contact at the bank for borrowers
seeking foreclosure prevention alternatives such as a loan modification, short
sale or deed-in-lieu foreclosure.
The new law generally pertains to owner-occupied
properties with one-to-four residential units, with certain exceptions. To view a more detailed discussion of the
California Homeowner Bill of Rights, it is available at http://www.car.org/legal/miscellaneous-contacts/realegal-chart/2012-realegals/sept28revised/.
Assembly Bill 278 and Senate Bill 900 (codified as Cal.
Civil Code §§ 2923.5 et seq.) (effective January 1, 2013).
Nancy Puder is the broker and owner of SignatureProperties, a prestigious real estate sales and management firm in Arroyo Grande, CA. You may contact her at Nancy@NancyPuder.com or (805)710-2415 Your calls are always welcome!
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