SACRAMENTO – Two bills by Assembly Majority Leader Alberto Torrico (D-Newark) to give borrowers more advance notice before their loans reset, and to protect renters whose landlords´ properties are in foreclosure passed the Senate Judiciary Committee this week on 3-2 votes.
AB 2586 gives renters 60 days to find new homes, requires renters to be directly notified in multiple languages that their rental units are in foreclosure, and requires their security deposits to be returned.
With more than 80,000 homes foreclosed last year in California and thousands more this year, renters are being forced out of their homes often with little notice and no hopes of regaining their security deposits.
"Innocent families are being hurt by these foreclosures," Torrico said. "By extending the notice provision from 30 days to 60 days, we are giving families more time to relocate and to secure housing."
Roughly one-quarter of foreclosed single family homes in California are occupied by renters. They are often left out in the cold.
AB 2586 is sponsored by the Western Center on Law and Poverty and is supported by more than 20 organizations including housing advocates, labor groups and social justice organizations.
AB 529, which cleared the Senate Banking, Finance and Insurance Committee last week, also cleared the Senate Judiciary Committee today. It aims to give borrowers improved noticed of when their loans are scheduled to reset and an example of how much their monthly payment would be if it reset at the time of notification.
Twenty percent of all subprime loans were delinquent at the end of last year, and with many borrowers holding loans with low fixed payments that are scheduled to readjust upward in the next three years, those numbers are likely to worsen.
Under AB 529, homeowners would be notified 90 to 120 days in advance of a change of payment of the following:
The borrower´s current monthly payment if the loan is currently fixed and then becomes adjustable or current minimum payment if it is based on a loan that is currently nonamortized but will become fully amortized.
The month and year in which the loan payment will change.
An example of the monthly payment if the interest rate adjusted at the time of notification or when the loan goes from nonamortized to fully amortized.
Whether or not the monthly payment will include taxes and insurance.
A telephone number the borrower may contact for additional information.
A statement that tells them that the actual payment information will be provided at least 25 days prior to the loan reset.
AB 2586 gives renters 60 days to find new homes, requires renters to be directly notified in multiple languages that their rental units are in foreclosure, and requires their security deposits to be returned.
With more than 80,000 homes foreclosed last year in California and thousands more this year, renters are being forced out of their homes often with little notice and no hopes of regaining their security deposits.
"Innocent families are being hurt by these foreclosures," Torrico said. "By extending the notice provision from 30 days to 60 days, we are giving families more time to relocate and to secure housing."
Roughly one-quarter of foreclosed single family homes in California are occupied by renters. They are often left out in the cold.
AB 2586 is sponsored by the Western Center on Law and Poverty and is supported by more than 20 organizations including housing advocates, labor groups and social justice organizations.
AB 529, which cleared the Senate Banking, Finance and Insurance Committee last week, also cleared the Senate Judiciary Committee today. It aims to give borrowers improved noticed of when their loans are scheduled to reset and an example of how much their monthly payment would be if it reset at the time of notification.
Twenty percent of all subprime loans were delinquent at the end of last year, and with many borrowers holding loans with low fixed payments that are scheduled to readjust upward in the next three years, those numbers are likely to worsen.
Under AB 529, homeowners would be notified 90 to 120 days in advance of a change of payment of the following:
The borrower´s current monthly payment if the loan is currently fixed and then becomes adjustable or current minimum payment if it is based on a loan that is currently nonamortized but will become fully amortized.
The month and year in which the loan payment will change.
An example of the monthly payment if the interest rate adjusted at the time of notification or when the loan goes from nonamortized to fully amortized.
Whether or not the monthly payment will include taxes and insurance.
A telephone number the borrower may contact for additional information.
A statement that tells them that the actual payment information will be provided at least 25 days prior to the loan reset.
