Bill Affecting Loan Mods Wins California Senate Committee Vote

The Center for Responsible Lending applauded the approval by the California Senate Banking, Finance and Insurance Committee of a proposal that would apply part of the Home Affordable Modification Program rules to all servicers who do business in the state, whether they participate in HAMP or not. The bill, SB 1275, would require all servicers to complete an evaluation of the borrower's eligibility for a loan modification before they begin the foreclosure process. In addition homeowners who have been erroneously foreclosed upon could receive a financial remedy of up to $10,000. Paul Leonard, director of CRL's California office, said, "It's a modest proposal, but it could do a world of good for Californians who are faced with losing their homes. Bill co-sponsor Sen. Mark Leno, D-San Francisco, explained, "Laws are not being broken. That's why we need laws. The vote to approve the bill was 7-1, and the Senate Judiciary Committee will now take up the legislation."