Governor Jerry Brown officially signed into law last week the Homeowner Bill of Rights to help struggling Californians keep their homes. The goal of this new law is to avoid foreclosures in an effort to help stabilize California’s housing market and prevent the effect they have on families, communities, and the economy. This law, known as Assembly Bill 278 and Senate Bill 900, can be found in its entirety at www.leginfo.ca.gov.

One of the highlights of this new law is "No Dual Tracking During a Short Sale" where a mortgage servicer cannot record a notice of default or conduct a trustee sale if the foreclosure alternative has been approved in writing by all parties. This is commonly known as a bank approval letter.

In addition, "No Dual Tracking" also includes during a loan modification, too. A mortgage servicer generally cannot record a notice of default or conduct a trustee sale if the borrower has completed an application for a loan modification and is pending as specified, or if a borrower is in compliance with the terms of a written trial or permanent loan modification, forbearance, or repayment plan.

Denial of a loan modification by the servicer, the borrower will generally have 30 days to appeal. The servicer cannot proceed with a foreclosure until 31 days after giving the Advertisement

[ Pala Mesa Resort ] borrower a written denial of a loan modification. This will be extended if the borrower appeals the denial.

However, the lender is not obligated to evaluate the application if the borrower has previously been evaluated before, unless the borrower submits new documentation that changes the borrower’s financial circumstances.

Another provision is that a mortgage servicer must now

assign to the borrower a single point of contact until all loss mitigation options offered by the servicer are exhausted. This single point of contact must coordinate the application and give timely and accurate status reports and have access to those with the ability and authority to stop foreclosure proceedings and referring the borrower to a supervisor upon the borrower’s request.

Also, for now, any written approval for a foreclosure prevention alternative now must be honored by any subsequent mortgage servicer in the event the borrower’s loan is transferred or sold to another servicer.

If you have questions regarding available inventory to purchase or the current bank servicer’s short sale incentives to sellers, contact Mike Mason, Broker/Owner of MASON Real Estate DRE: 01483044, Board of Director of your Southwest Riverside County Association of Realtors® (SRCAR), Short Sale & Foreclosure Resource certified by National Association of Realtors® (NAR) at Mike@GoTakeAction.com or

(951) 296-8887.