Foreclosure Bill in the Hands of California Governor

Posted on July 9th, 2008 by saman

California foreclosures occur when a homeowner cannot make their mortgage payments. When this happens, a lender may take and sell the property. The lender will most likely offer the homeowner a few different options, depending on the particular situation of the homeowner.

A foreclosure in California largely depends on whether the homeowner wants to keep their property. If the homeowner does not want to keep the home, they can sell the home themselves before the foreclosure process commences. There is a great advantage to this because the homeowner will not have a foreclosure on their credit report. This will make it a lot easier to get financing in the future. The option of selling the home before it is foreclosed on is usually open to those who have equity left in the home.

A new bill designed to help homeowners stop foreclosure is now in the hands of the governor of California, Arnold Schwarzenegger. He has stated that he will support the bill.

The bill was inked by the president of the Senate Don Perata, a democrat from Oakland. The Senate voted in favor of the bill thirty two to eight. Governor Schwarzenegger has twelve days to sign the measure and it will go into effect right away.

The bill came about as a response to the mortgage crisis in California. The bill requires those who hold mortgages to contact the homeowner in person or on the telephone thirty days before they file a notice of default. It also calls for the mortgage holders to discuss payment options with the homeowner.

The bill also increases the time from eviction from rental properties that are in foreclosure from thirty to sixty days. It gives local governments authority to levy a fine against homeowners who do not maintain their vacant lots.

The co-author of the bill, Karen Bass stated that the bill give homeowners real relief. She stated that she and Senator Perata wanted to show that the job of the government is to come together so those in California can keep their homes.

The idea for the housing bill came about two years ago at a community forum sponsored by the group ACORN. The bill has undergone a great deal of revision because mortgage companies and banks were opposed to the bill. They now support it.

When the bill was first written it required lenders to meet with homeowners in person if they were facing a default. The bill has since been changed to allow the lender to contact the homeowner by phone, e-mail, or regular mail. This type of change prompted the mortgage association in the state to withdraw their opposition to the bill.

Recently, the mortgage association stated that the bill will give immediate assistance to families without discouraging the investments needed to restore the housing market in California.

However, there are many legislators that are still opposed to the bill. Ted Gaines stated that he dislikes the bill’s provision that allows the government to fine those who own foreclosed lots. He does not like the fact that this comes off as a mandate from the government.

Homeowners believe that the bill is very important in helping homeowners avoid foreclosure. One homeowner could not find anyone to help him avoid the foreclosure of his home. The bill will help him facilitate a meeting with his bank and for him that would be a good first step.