Patricia Rodriguez explains 2013 vs. 2018: CALIFORNIA’S HOMEOWNER BILL OF RIGHTS
Ms. Rodriguez currently and for the past seven years has represented a wide range of clients, focusing her representation on borrowers facing non-judicial foreclosure. She is dedicated and focused on her practice; she both carries a caseload and manages the entire legal and business team.
2013 vs. 2018: CALIFORNIA*S HOMEOWNER BILL OF RIGHTS - part 1Due to no legislation being enacted/amended to extend borrower protections currently found within the Homeowner Bill of Rights ("HBOR") (2013) California borrowers have lost the following protections against often overzealous and aggressive mortgage/loan servicers:
1. On and after January 1, 2018, prior to recording an NOD, borrowers will no longer be entitled to a statement from their servicer/lender that the borrower may request the following: (1) A copy of the borrower's promissory note or other evidence of indebtedness; (2) A copy of the borrower's deed of trust or mortgage; (3) A copy of any assignment, if applicable, of the borrower's mortgage or deed of trust required to demonstrate the right of the mortgage servicer to foreclose; (4) A copy of the borrower's payment history since the borrower was last less than 60 days past due; and/or (5) And if the borrower is a servicemember or a dependent of servicemember, he or she will no longer be entitled to statement from servicer/lender that there may be certain protections under the federal Servicemembers Civil Relief Act (50 U.S.C. Sec. 501 et seq.) regarding the servicemember's interest rate and the risk of foreclosure, or that counseling for covered servicemembers may be available at agencies such as Military OneSource and Armed Forces Legal Assistance. (Cal. Civ. Code * 2923.55 (2013)).
2. On and after January 1, 2018, if a borrower submits a *complete* application for a first lien loan modification, the mortgage servicer, trustee, beneficiary or authorized agent may record an NOD against the borrower's interest in his or her home. (Cal Civ. Code * 2923.6(c)(2013) repealed; Cal. Civ. Code * 2924.11 (2018)).
3. On and after January 1, 2018, if a servicer denies a borrower's application for a loan modification, servicer must still identify the reason(s) for the denial, but servicer is no longer required to (1) permit borrower to submit an appeal; (2) wait 31 days to conduct a trustee's sale; (3) withhold recording NOD or NTS during review of gratuitous appeal evaluation; (4) provide specific reasons for investor denial; or (5) provide NPV input values applied in arriving at denial decision. (Cal Civ. Code * 2923.6(c)(2013) repealed; Cal. Civ. Code * 2924.11 (2018)).
4. On and after January 1, 2018, servicers are no longer obligated to provide written notice (or any notice for that matter) to a borrower that a scheduled trustee's sale was postponed for more than 10 business days following a postponement of a trustee's sale. (Cal Civ. Code * 2924.9 (2013) repealed).
5. On and after January 1, 2018, servicers are no longer prohibited from charging any application fee, processing fee or any other fee for any foreclosure prevention alternative. Neither will servicers be prohibited from collecting any late fees for periods during which a loan modification application is under consideration or when the borrower is making timely modification payments or any other foreclosure prevention alternative is being evaluated. (Cal Civ. Code * 2924.11 (2013) repealed and not replaced with equivalent protections).
2013 vs. 2018: CALIFORNIA*S HOMEOWNER BILL OF RIGHTS - part 26. On and after January 1, 2018, whenever a borrower submits a complete application for a loan modification, or any document in connection with a loan modification, servicers are no longer required to provide written acknowledgment of receipt or any of the following valuable protections: (1) a description of the loan modification process, estimated time for decision, and length of time borrower will have to consider any loan modification offer; (2) any deadlines to submit purportedly missing documents; (3) any expiration dates for submitted documents; and (4) any other deficiencies within borrower's submitted application for a loan modification. (Cal Civ. Code * 2924.10 repealed).
7. On and after January 1, 2018, if borrower's servicer approves borrower in writing for a loan modification or any other foreclosure prevention alternative, any successor servicer is not required to continue honoring California*s Homeowner Bill of Rights 2013 vs. 2018: A Pithy Primer 2 any previously approved loan modification or foreclosure prevention alternative granted and entered into by borrower's predecessor servicer. (Cal Civ. Code * 2924.11(g)(2013) repealed).
8. On and after January 1, 2018, if a servicer issues a denial decision to a borrower's application for a loan modification, erroneous and objectionable as it may be, servcier and trustee may proceed directly towards completing their scheduled sale and borrower may no longer seek judicial intervention with an application or motion for injunctive relief as Cal. Civ. Code * 2924.11(2018) no longer requires any appeals period or dual tracking protections after a written denial decision has been issued. Imagining the socio-economic impact that would be shouldered by thousands of California families and homeowners, alike, resulting from the potential and likely abuses that would occur from servicers in a State without the above protections - only to line the pockets of the latter - is not the vision or direction Californians now hold or desire to traverse. Californians have already witnessed first-hand the devastation and financial ruin that foreclosures can have upon individuals, families and even entire communities. Foreclosed bank-owned properties are often left sitting as empty homes leaving a void often exploited by undesirables like squatters and trespassers, and often provides cover for drug use, prostitution and other illicit activities. Short sales have a direct and negative effect upon surrounding homes * bringing home values down while frustrating hardworking Californian's who for years have paid faithfully on their homes, or investment properties, only to have their built equity stripped away by one, or even several, short sales in their community. The continuing protections of the HBOR, in its most unadulterated form, are critical to preserving and supporting the on-going recovery of the State's economic health. The stated aims and intentions of passing SB 900 and AB 278 have filled the void of absent but necessary legislation where widespread and rampant abuses carried out upon California residents by overreaching servicers needed to be curbed through explicit legislative prohibition.
2013 vs. 2018: CALIFORNIA*S HOMEOWNER BILL OF RIGHTS - part 3One need only look to the mountain of litigation California homeowners have filed in California State and U.S. Federal Courts lying in California since 2013 alleging violations of California's HBOR. Though the protections provided by the HBOR (2013) are not perfect, they have proven infinitely more effective than its impotent predecessor. At this time, adjustments to the codified text are ripe for consideration and proposed amendments are warranted as litigation practices servicers have discovered and exploited common and favored "loopholes" peppered throughout the added and amended Sections of the HBOR often resulting in servicers skirting liability and accountability for their wrongful and unlawful conduct. In summation, permitting these proven, critical and necessary laws to sunset completely or be replaced by an impotent and diluted successor would be a grave and dangerous proposition. The time to act is now. There is adequate time to develop, draft and pass a thoughtful, well-researched and improved version of the HBOR that would continue to provide greater protections California homeowners have both needed and enjoyed for almost four years as well as an opportunity to close the loopholes that have been artfully exploited by incalcitrant servicers * many of whom are corporate citizens of other states who conduct business within our State while harming our citizens in the process. Together, we can work to bring improved fairness to California's homeowners through compulsory processes and accountability for market participants who operate the levers of California's non-judicial foreclosure process Please direct any questions, comments or concerns to the address provided above. Thank you for your time and consideration.