Beall Acts to Restore Homeowner's Bill of Rights

January 03, 2018

SACRAMENTO – With several key provisions of the California Homeowner’s Bill of Rights lapsing on Jan. 1, Sen. Jim Beall, (D-San Jose), quickly introduced legislation today to renew them, continuing important mortgage and foreclosure protections that borrowers have relied on to save their homes.

“Senate Bill 818 will restore the rights, the safeguards, which have helped thousands of people keep their homes,’’ said Beall, who serves as the chairman of the Transportation and Housing Committee. “We do not want people to lose these rights, which had existed for the past five years. 

“The need for the Homeowner’s Bill of Rights is especially critical because so many families hit by wildfires in Northern and Southern California will be coping with financial setbacks as they seek to rebuild their homes.’’

Sen. Toni Atkins, (D-San Diego), who is co-authoring SB 818, said,  “I am proud to join Senator Beall in his effort to extend protections for California families at risk of losing their homes, and I thank him for his leadership on this critical issue. In addition to creating more housing opportunities for all Californians, we must do everything in 

our power to support struggling homeowners who are fighting foreclosure.”

Among the rights Senate Bill 818 would restore are critical protections against dual tracking – when servicers simultaneously enter loan modification negotiations with borrowers while continuing foreclosure. The bill also continues other HBOR protections, including:

• The right to appeal the denial of a loan modification application

• Requirements that loan servicers provide homeowners with written notices to confirm receipt of their loan modifications applications and whether any necessary application items are missing. 

• Requirements that servicers send written denial notices with sufficient information and sufficient time to appeal a questionable denial. 

The Homeowner’s Bill of Rights was passed and signed into law in 2012 to stop what Gov. Brown described then as the “abusive tactics’’ of loan servicers “who would push foreclosure behind the back of an unsuspecting homeowner.’’  From 2008 to 2011, foreclosures had cost one million Californians their homes.

Experts say the need to keep alive HBOR’s robust protections is just as great today as in 2012. 

Kevin Stein, Deputy Director, California Reinvestment Coalition:
“The California Homeowner Bill of Rights was landmark legislation that brought reasonable protections to families who were unnecessarily losing their homes because of the aggressive and unfair foreclosure practices of banks, Wall Street firms and mortgage loan servicers. Foreclosures may have dipped for now, but Californians today are no less deserving of the fair chance to keep their homes that HBOR provided. And, it is just as necessary to ensure lenders and servicers continue to be held accountable in order to prevent abuses that propelled unsuspecting households into foreclosure. We thank Senator Beall for authoring this important bill that will extend much-needed protections to California homeowners.”                     

Lisa Sitkin, Senior Staff Attorney, National Housing Law Project:
“Having basic procedural protections during the loan modification application process has saved families’ homes. Losing these protections -- including the opportunity to appeal a wrongful denial before a foreclosure goes forward -- increases the risk of an avoidable foreclosure.’’

Maeve Elise Brown, Esq., Executive Director, Housing and Economic Rights Advocates:
“California homeowners deserve the full protections of the original HBOR which proved itself to be an effective and much-needed protection for homeowners against procedural abuses that were forcing them into foreclosure.’’

Lisa Hershey, Executive Director, Housing California:
“A California law that has been saving homeowners from unfair, preventable foreclosures for the last five years must be extended beyond its 2017 year-end sunset, or the state will be taking a giant step backward in the fight to ensure all Californians have homes. We support Senator Beall in his effort to extend the Homeowners Bill of Rights to safeguard families, neighborhoods and our economy, and to further the state’s work in reversing exclusionary homeownership policies.”

The importance of the HBOR can’t be exaggerated for homeowners who have used it stay in their homes and negotiate a loan modification. Listen to homeowners like Steve Kipgen, who are using the HBOR as leverage against questionable actions by lenders and loan servicers.

“The Homeowner’s Bill of Rights gives me the opportunity to fight it,’’ said Kipgen, an Orangevale resident. “I would be homeless without the Homeowner’s Bill of Rights.’’

Also co-authoring the bill are Assemblymember David Chui, who is a principal co-author; Assemblymembers Rob Bonta, Ash Kalra, Evan Low, and Kevin Mullin; Senators Cathleen Galgiani, Jerry Hill, Scott Wiener, and Bob Wieckowski.