Homeowners everywhere should be looking at California and taking notice. The government there is finally taking the power away from the banks and placing it back in the hands of the homeowners.
Outside of Florida, no state has been quite as devastated by the fraudclosure crisis as California has, so it comes as no surprise that they would be at the center of what looks like a growing trend.
Just this week Governor Jerry Brown signed into a law a Homeowners Bill of Rights. This legislation, among other things, will restrict dual-tracking, the shady practice of modifying a loan while still pursuing a foreclosure.
The law will also impose a singular point of contact for homeowners to deal with at their lender.
And of course it requires banks to prove that they have the legal right to foreclose and preserves the right for homeowners to take legal action when they don’t.
On one level it seems so preposterous that such rules would be needed, but we let the fox guard the henhouse for far too long, hence the reason we had a foreclosure crisis in the first place!
Those things that should be obvious are no longer just violations of common law (and common sense) but are finally being codified as violations of statutory law.
The reality is what you are seeing in California is an absolute necessity and they are not the only ones. Nevada actually passed similar rules last year. New York’s State Assembly just passed a bill that would criminalize robosigning, although sadly the Senate did not vote on the legislation this year.