As of January 1, 2013, the California Homeowner Bill of Rights (HBOR) went into effect, prohibiting unfair bank practices and altering how California banks, foreclosure attorneys, and homeowners interpret the default foreclosure process.

California homeowners should inform themselves of their options and rights. The law aims to keep homeowners in their homes with initiating new loan modification rules, facilitating improved communication through a single point of contact, prohibiting fraudulent document signatures (also known as robo-signing), restrict lender dual tracking, and promoting foreclosure alternatives for borrowers.

Neighboring lawmakers in Nevada are backing a similar bill, Senate Bill 321,that would set up civil penalties for banks that are cutting corners. The bill would also construct foreclosure mediation requirements for homeowners. Similar to the California HBOR, it will restrict dual-tracking, a bank tactic that pursues foreclosure unknown to the homeowner who is exploring alternatives. The Nevada bill would also include:

  • Promotion of a single point of contact.
  • 30-day requirement before foreclosure recordings for the servicers to provide homeowners with foreclosure alternatives.
  • Prohibition of servicers continuing with foreclosure until complying with all requirements to work with distressed homeowners and borrowers.
  • Penalties for financial firms when violating rules mentioned in bill.

In today’s housing market, servicers are constantly selling their servicing rights to reduce their portfolio size, in turn reducing their risk of law breaking. Smaller companies that specialize in mortgage servicing rights, like Walter Investment Management and Nationstar Mortgage Holdings, are investing in these servicing rights and currently do not have to follow bank rules.

In light of the housing bust, collecting payments as more borrowers become delinquent is a growing industry. Transferring mortgage loans and furthering the homeowner protection are continuing to expand. That’s why it’s more important than ever to accurately record and comprehensively retrieve all the necessary information.

Blue Streak Docs is a document retrieval company offering document recordings and retrieval for mortgage professionals and real estate attorneys. For more information about our superior service, give us a call today at 727-479-0007.

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