Posts Tagged ‘Attorney general’

Federal Housing Chief Supports California Bill of Rights

The series of bills backed Attorney General Kamala Harris to help avoid future foreclosure abuses have found a new supporter in federal housing chief, Shaun Donovan.

The so-called California Bill of Rights “would restrict practices such as foreclosing on homeowners as they try to negotiate a loan modification and mandate that banks designate a single person to work with troubled borrowers,” as reported by the Los Angeles Times.

The financial-industry and business trade groups have opposed the bills, arguing that while the national mortgage settlement’s terms are temporary and apply to only five banks, the bills’ changes would be permanent and universal. In fact, the proposed California Bill of Rights provides longer term protection for homeowners where the national mortgage settlement expires.

Those who oppose the bills also object to giving borrowers the right to sue to block foreclosures or recover losses when banks violate the law in more than just a trivial way. We feel strongly that banks should not be able to take advantage of distressed homeowners and ignore their rights in any way during the foreclosure process. The national mortgage settlement does not acknowledge individual borrowers whose lenders violate the new safeguards but the proposed California Bill of Rights provides a remedy to that.


The California Homeowners Bill of Rights

April 20, 2012 Leave a comment

California Attorney General Kamala Harris has been working since earlier this year on a package of bills to help protect homeowners from foreclosure and wrongful foreclosure practices by banks.

The so-called California Homeowners Bill of Rights was to be put to vote by the California Assembly’s Senate Banking and Finance Committee on Monday. However, Chairman Mike Eng (D-Monterey Park) of the Assembly Banking and Finance Committee asked that debate be postponed for a week in an effort to amend the bills so a compromise could be reached during negotiations with consumer groups and mortgage bankers.

In a press release issued by the Office of the Attorney General, the provisions of the bills were outlined and were aimed at making sure that homeowners are not put on a so-called dual-track process that allows banks to continue a foreclosure process at the same time they are negotiating possible loan modifications.

According to the Huffington Post,

“Other provisions in the bundle require banks to provide homeowners with a single point of contact during the loan modification process and levy a $25 fee on banks every time they register a default. Proceeds from the default fee would then go into a pool of money funding mortgage fraud investigations.”

While some of the provisions outlined in the proposed Bill of Rights overlap with the national mortgage settlement, the settlement expires in three years and Harris wants the rules to extend into perpetuity.

Harris has support from many political leaders on the proposed Bill of Rights, including San Francisco Mayor Ed Lee, as well as dozens of consumer, fair-lending and economic justice organizations, but faces opposition by mortgage bankers, bankers, credit unions and the financial industry.

California Returns to the Negotiation Table

February 6, 2012 Leave a comment

According the Los Angeles Times, California has resumed negotiations on the multibillion-dollar, multi-state mortgage settlement with the nation’s largest banks. Friday’s deadline for individual states to either reject or accept the deal has been pushed to today.

California Atty. Gen. Kamala Harris walked away from negotiations last year and had originally held out on agreeing to the settlement, seeking tougher terms for banks. In a statement Sunday night, Harris said the door still remained open for California to join.

“For the past 13 months we have been working for a resolution that brings real relief to the hardest-hit homeowners, is transparent about who benefits and will ensure accountability,” Harris said. “We are closer now than we’ve been before, but we’re not there yet.”

If California agrees to the settlement the pot for mortgage relief nationwide would increase to $25 billion from $19 billion. Another important potential backer, Attorney General Eric T. Schneiderman of New York, has also signaled that he sees progress on provisions that prevented him from supporting it in the past. Support from both states would be a significant accomplishment for the administration, which in recent weeks has been trying to step up its aid for the failing U.S. housing market.

Under the proposed settlement, banks would be forced to provide financial assistance for homeowners who experienced foreclosure or are in danger of losing their homes. If approved, the settlement would require banks to overhaul their mortgage servicing and foreclosure practices and include a component for principal write-downs which has been recognized as the best way to help underwater homeowners and stabilize the housing market.