California official introduces loan modification bill
Pedro Nava (D-Calif.)
Barbara Buckley (D-Nev.)
SACRAMENTO, Calif. (Legal Newsline)-The thousands of Californians facing home foreclosure could have more help on the way, under legislation introduced by a Democratic candidate for state attorney general.
State Assemblyman Pedro Nava, D-Santa Barbara, wants to allow homeowners who have been served a notice of default to enlist the help of a state-appointed monitor to negotiate lenders with the goal of lowering monthly payments.
The Assembly Banking and Finance Committee headed by Nava on Thursday heard testimony about loan modification programs and the overall housing crisis.
"This crisis has devastated thousands of California families and communities. It's time to take a new approach to help families remain in their homes," Nava said, adding that existing loan modification programs have been "ineffective and the number of families benefiting from them is minimal."
While working through the loan modification process, under Assembly Bill 1588, lenders would be unable to foreclose homes.
California had the second highest foreclosure rate in the nation last month, Irvine, Calif.-based RealtyTrac said Thursday.
In October, 85,420 California properties received a foreclosure notice, down 1 percent from a month earlier, the firm said.
While home foreclosure filings fell 3 percent in October nationally, foreclosure filings are up 19 percent from a year ago, RealtyTrac said.
Nevada, which leads the nation in its rate of home foreclosures, has a loan modification program similar to the one Nava has proposed for California.
The Nevada program was enacted in May by the state Legislature there.
"No matter where we live, it is critical that we do all we can to help reduce the number of foreclosures and help people stay in their homes," said Nevada Assembly Speaker Barbara Buckley, D-Las Vegas, who testified in Sacramento about her state's program.
"Our program in Nevada has shown initial success in stemming foreclosures. While I understand the obstacles California faces as a non-judicial foreclosure state, I look forward to working with the California Legislature to find ways that a similar program could be implemented," she said.
In the one month the Nava program has been in effect, more than 3300 homeowners have requested mediation, with 1514 requests processed, 888 cases assigned to a mediator and 106 mediations completed, officials said.
From Legal Newsline: Reach staff reporter Chris Rizo at firstname.lastname@example.org.