Governor Holds Signing Ceremony For Package of Mortgage Reform Bills
Governor Schwarzenegger held a signing ceremony in Merced this morning to publicly approve a package of lending reforms aimed at preventing another foreclosure crisis.
“The Governor could not have chosen a more appropriate location to highlight these bills. Merced is one of the hardest hit cities in the hardest hit state in the country in terms of numbers of foreclosures,” said Pedro Morillas CALPIRG Consumer advocate.
The bills signed today are significant for California in a couple of ways. First, these bills represent the first actions taken by the state to address the causes of the mortgage crisis. Second, these bills make California one of the leaders in addressing the excesses of the lending industry, and will likely influence the movement at the federal level to reign in bad actors in the marketplace.
According to Morillas, “Today Governor Schwarzenegger put California at the leading edge of reforms that will curb the ‘quick buck’ mentality that created this mess.”
Here is a list of the bills signed today, and a brief description:
AB 260 (Lieu): Protects consumers from unscrupulous lending practices by removing the incentive for brokers to put borrowers into worse loans than they qualify for.
AB 1160 (Fong): Protects non-English speaking consumers by requiring lenders to provide the details of a loan in the same language the mortgage is negotiated in.
SB 94 (R. Calderon): Protects troubled borrowers from loan modification scams by banning upfront payment for loan modification services.
AB 329 (Feuer): Protects older consumers of reverse mortgages by ensuring they have adequate information about what they are agreeing to when setting up a reverse mortgage.
AB 957 (Galgiani): Ensures consumers have a choice of title insurance or other escrow services when purchasing a foreclosed home by making it illegal for sellers to require certain vendors for title insurance or escrow services as a condition of the sale.
SB 36 (Calderon): Brings California in compliance with new federal mortgage lending protections by allowing sate agencies to create a more standardized tracking system for mortgage brokers.
SB 237 (Calderon): Creates a registration program for appraisal management companies (AMCs) and prohibits any person or entity from acting in the capacity of an AMC without first obtaining a certificate for registration from the Office of Real Estate Appraisers.
SB 239 (Pavley): This bill increases accountability for mortgage brokers by making individuals who engage in mortgage fraud guilty of a public offense.
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