Assembly Approves Leno Bill to Prevent Foreclosures

South San Francisco, CA  August 22, 2016  Press Release Senator Mark Leno’s Office marklenolgog

SB 1150 Helps Families Avoid Unnecessary Foreclosure when a Mortgage Holder Dies

SACRAMENTO – The Homeowner Survivor Bill of Rights, authored by Senators Mark Leno and Cathleen Galgiani, was approved by the State Assembly today. Senate Bill 1150 closes a loophole in California law that fails to provide surviving family members important protections against foreclosure that are available to other homeowners.

“Surviving homeowners who legally inherit their home deserve access to accurate information about loan assumption or modification,” said Senator Leno. “Instead, grieving family members face foreclosure threats and lender red tape, adding considerable stress to an already difficult time. California must step in before more family homes are taken away.”

While the California Homeowners’ Bill of Rights—approved by the Legislature in 2012—provided foreclosure relief for thousands of California families, the legislation did not protect surviving family members who own their homes but are not listed on the mortgage. These survivors report that servicers fail to provide factual information about loan details and foreclosure avoidance programs or refuse to communicate with them. As a result, many families have experienced unnecessary foreclosures.

SB 1150 clarifies the responsibilities of a mortgage servicer when a borrower dies and one of the surviving homeowners wishes to assume the loan. The legislation ensures that heirs receive accurate information about loan assumption and foreclosure prevention programs. It also gives survivors a single point of contact with the servicer and the ability to apply for loan assumption and modification.

“The Assembly’s approval of SB 1150 is another step forward in California leading the nation when it comes to protecting homeowners from unscrupulous foreclosure practices,” said Maeve Elise Brown, Executive Director of Housing and Economic Rights Advocates. “SB 1150 is a pragmatic way to stop widows, widowers, and other heirs from needlessly losing their homes to foreclosure and we hope Governor Brown signs it quickly.”

SB 1150 is sponsored by the California Alliance for Retired Americans, Housing and Economic Rights Advocates and California Reinvestment Coalition. The bill is supported by Attorney General Kamala Harris, AARP and the California District Attorneys Association, as well as a long list of civil rights, housing and labor organizations.

“We’re grateful to the more than sixty organizations that supported SB 1150,” said Kevin Stein, Associate Director of the California Reinvestment Coalition. “We also appreciate the courage shown by surviving homeowners like Ric Hornor and Blanche Robles who testified about the countless obstacles they (and too many other Californians) face in trying to retain their homes. Further, we thank the housing counselors and legal aid attorneys who first raised the alarm about the problem, and who have been on the front lines, helping surviving homeowners to try and navigate these Kafkaesque bureaucracies. We urge Governor Brown to sign SB 1150 into law to prevent any more California seniors from losing their homes.”

Before heading to the Governor, SB 1150 will be sent to the Senate for concurrence.

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