Important Protections For Widowed Homeowners Facing Foreclosure

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The largest asset most Americans have.

The California Reinvestment Coalition has been contacted by a number of homeowners and heirs who are struggling to understand what their rights are when working with their mortgage servicers- especially in cases where the borrower who is on the mortgage has passed away.

As of January 1, 2017, a new law went into effect in California which will be very helpful for families who may be facing unnecessary foreclosures because their servicers are refusing to speak with them.  The law is called the Homeowner Survivor Bill of Rights, and you can learn more about it on this website.

If you are a homeowner or heir trying to speak with your bank or mortgage servicer and they are refusing to speak with them, you may ask if they’re aware of the new law- and the requirements under it.

If you are still hitting a brick wall when trying to speak with your bank or servicer, please give CRC a call and we’ll connect you with experts in your area.

New Protections For Widowed Homeowners and Other Heirs in California

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Great news!  Senate Bill 1150, the Homeowner Survivor Bill of Rights (SBOR), was signed into law on September 29, 2016.  The law will take effect in January, 2017.

SBOR will address egregious behavior by banks and mortgage servicers who have refused to speak with surviving homeowners about their family homes and option to retain them.

If you are a surviving homeowner who is hitting a brick wall when trying to speak with your mortgage servicer, please contact us so we can connect you to resources.

To learn more about SB1150, you can read this Los Angeles Times article:

California Gov. Jerry Brown on Thursday signed a bill that’s designed to give widows and widowers a better shot at saving their homes when they fall behind on mortgage payments. Senate Bill 1150 boosts protections against foreclosure for surviving spouses who own their home but are not on its mortgage note.

Read the rest of the article here:  California Gov. Jerry Brown signs a bill that boosts protection for surviving spouses against foreclosure  (Andrew Khouri, Sept. 29, 2016)

 

How YOU can Help Stop “Widow Foreclosures” by Contacting Governor Brown

SB 1150 approval by Senate

After months of hard work, hearings, and media coverage about Senate Bill 1150 (Leno, Galgiani), it was approved by the California Senate yesterday!

Now, the bill heads to Governor Brown.

And that’s where you can help!

If you have been impacted by this issue personally (or have friends or relatives who have), if you are a housing counselor or attorney who has helped “surviving homeowners,” or if you have followed this issue and believe in the need for SB 1150, then we need your help, as soon as possible.

If you have ten minutes, please write a quick letter to Governor Brown and put it in the mail.  We’ve been informed that real letters

Here’s a link to the sample letter.

If you have any questions, please contact CRC:  Kstein AT calreinvest.org.

And, we extend a HUGE thank you to Senator Leno and Senator Galgiani, the more than 60 organizations supporting SB 1150, the brave homeowners who have shared their difficult stories about facing needless foreclosures, and the housing counselors and legal aid attorneys who originally helped bring this problem to the public light. 

Sincerely,

The SB1150 Team

California Reinvestment Coalition

Housing and Economic Rights Advocates

California Alliance for Retired Americans

 

 

Widowed Homeowners a Step Closer to Avoiding “Red Tape Foreclosures”

Senate Bill 1150

Last Tuesday, the California Senate voted Senate Bill 1150, the Homeowner Survivor Bill of Rights (Los Angeles Times: Bill aimed at helping widows avoid foreclosure passes state Senate) forward. This means that widows, widowers, and other heirs are one step closer to avoiding what’s been called the “bureaucratic black hole,” when their loved ones pass away and they were the only ones listed on a mortgage.

Housing counselors, attorneys, and consumer advocates have been trying to address this problem for several years now, but banks and mortgage servicers have refused to follow new guidance from regulators on this issue.

In the most common scenario, a husband passes away, and his name was the only one on the mortgage.  When she contacts her mortgage servicer, she will likely face a mind-numbing bureaucracy of incorrect information, being passed back and forth between different departments, and delays lasting months or even years.  Incredibly, in a number of cases, surviving homeowners have been told they can’t talk to the bank until their deceased loved one signs a form authorizing them to do so.

Meanwhile, the foreclosure process is moving forward. Surviving heirs, numb from the loss of their loved ones, are also faced with the prospect of losing the home over their heads.

These survivor have an ownership interest in their home, yet the banks and servicers are engaging in the same practices that caused the California legislature (with strong support from Attorney General Kamala Harris) to pass the Homeowner Bill of Rights.

The next step for the bill is the Assembly Banking Committee.  We anticipate that the bank lobbyists will be working hard to maintain the status quo, so if you’re interested in helping to disrupt that status quo, please contact us.

 

Bill Helps Widowed Spouses and Children Keep Their Family Homes

SACRAMENTO – New legislation introduced by Senators Mark Leno and Cathleen Galgiani provides critical protections for widowed spouses and other survivors who assume home ownership responsibilities when the primary mortgage holder passes away. The Homeowner Survivor Bill of Rights, (Senate Bill 1150) closes a loophole in California law that fails to provide surviving spouses and children important protections against foreclosure that are available to other homeowners.

“Grieving family members who have the financial ability to remain in their homes following a loved one’s death shouldn’t have to face the added stress of a lender’s red tape,” said Senator Leno, D-San Francisco. “Widowed spouses are being consumed by a labyrinth of processes in an attempt to assume or modify existing home loans after the primary mortgage holder passes away. This has led to preventable foreclosures and worsened the suffering of families already thrown in personal crises.”

In 2012, California led the nation in providing foreclosure relief for homeowners by passing the Homeowners’ Bill of Rights (HBOR), which requires a single point of contact at a lending institution and prohibits dual-tracking, a practice where lenders foreclose on a home while the owners are simultaneously seeking a loan modification. Unfortunately, servicers argue that surviving family members who are not named on the loan are not covered by HBOR. These survivors report that lenders refuse to communicate with them or fail to provide factual information about loan details and foreclosure avoidance programs. As a result, many families have endured unnecessary foreclosures.

“After the death of my husband, it took me two stress-filled years and help from an attorney to keep our family home,” said Blanche Robles, a homeowner in Madera. “It was clear that my mortgage servicers were confused about the process for somebody in my situation, and helping me was not a priority. Even worse, after two years of working with Chase, I had to restart the process with a new servicer when my mortgage was suddenly transferred. I’m glad something is being done to protect families like mine.”

SB 1150 clarifies the responsibilities of a mortgage lender when a borrower dies and passes the home along to a survivor who wishes to assume the home loan. The legislation ensures that heirs receive accurate information about loan assumption and foreclosure prevention programs. It also gives survivors a single point of contact with the lender and the ability to simultaneously apply for loan assumption and modification. SB 1150 is sponsored by the California Alliance for Retired Americans, Housing and Economic Rights Advocates and California Reinvestment Coalition.

“There are more than 3 million senior homeowners in California, and as our aging population continues to grow, so does this problem,” said Hene Kelly, legislative director at the California Alliance for Retired Americans. “Older women are particularly harmed by the state’s lack of homeowner protections because they tend to live an average of seven years longer than men.”

Nonprofit housing counselors and legal services attorneys in California report that the majority of their clients who are surviving homeowners have had difficulties working with mortgage lenders and faced foreclosure.

In the past three years, attorneys from our organization have helped nearly 50 people caught in this predicament,” said Maeve Elise Brown, executive director at Housing and Economic Rights Advocates. “While we’ve helped them, we know many more are falling through cracks because they don’t have access to an attorney.”

“We can’t allow the status quo to continue,” said Kevin Stein, associate director at the California Reinvestment Coalition. “SB 1150 is a common-sense solution that would make a world of difference for families who are going through tough times.”

The Homeowner Survivor Bill of Rights will be heard in Senate policy committees this spring.