Attorney General Kamala D. Harris Announces Homeowner Bill of Rights
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Attorney General Kamala D. Harris Announces Homeowner Bill of Rights

August 25, 2019


good morning we are here to announce the
California homeowner Bill of Rights and I want to start by applauding the
leadership of the speaker Perez and Senate Pro Tem Steinberg this has been a
journey and we are only I think we’ve only not even halfway through we’re just
these are the beginning steps but but I have to say in front of my colleagues
members of the Senate and Assembly that you all have been incredibly supportive
and real leaders to to our effort to bring relief to California homeowners
and throughout the process many of you know that was a 13-month process in
terms of the settlement discussions with the banks my colleagues standing behind
me we’re standing behind us the entire way and so I wanted to thank you all for
that so today what we are doing is
essentially announcing the next step in the many steps that are necessary to
bring justice to California and to California homeowners so we announced a
couple of weeks ago a settlement where we returned and brought back to
California 18 billion dollars from the five largest banks in the country and we
were able to accomplish that in a way that is going to provide meaningful
relief but in a way that also did not give a blank check of immunity to the
banks for their misconduct we did that while preserving our ability to
investigate conduct that has not been investigated to ensure that there will
be consequences and accountability for conduct that has harmed California in a
very significant way as many of you know we have had the distinction in our
country of having at one time nine now seven of the top ten cities in this
country hardest hit by the foreclosure crisis in fact we’ve been battling with
Nevada for the number one place on that list Stockton or Las Vegas so it’s a
real issue and it’s an issue that impacts families and communities as
varied as Boyle Heights to Stockton and ma span yoson and many other places and
the families who are impacted our people who really have done
everything we should expect of law-abiding good people they are people
who have worked hard who have believed in the American dream they went out and
bought a home like they were supposed to as evidence of all of their hard work as
a place that would provide shelter for their families something that
represented for them their ability to pay for their children’s college tuition
and have a retirement that would allow them to live with dignity and we have
homes up and down this state that have been in the last couple of years in the
process of foreclosure we expect that the pipeline currently in California for
foreclosure is that we have about five hundred thousand homes currently in that
process we have had the distinction of having approximately two million homes
mortgages that were underwater so it’s a real issue and as we have been traveling
the state then we’ve been talking with these homeowners with these families
with these Californians and they express a number of concerns and frustrations
around a system that has not been fair so what we are announcing today in this
California homeowner Bill of Rights is the ability to correct the course and to
provide them with a system where the rules are clear where everyone gets a
fair shot and where everyone has equal standing around this issue specifically
what we are doing is we are proposing six bills and as you can see it is a
function of the collaboration of both of our houses in the legislature with a
commitment that spans again various counties that range from urban to
suburban to rural and agricultural that ranged from red to blue to purple and
the first bill we are referring to as a foreclosure reduction act what it will
do this bill is essentially give homeowners basic standards of fairness
and most specifically it will address the dual track issue the dual track
issue many homeowners will tell you is is it
is it absolutely insidious process because essentially what happens is that
the homeowner who is in the process of being foreclosed upon okay often time
will we’ll borrow money from friends and family tens of thousands of dollars to
try and modify their loan so they could stay in their home so they’re in the
foreclosure process and the modification process dual-track two tracts these two
tracts are not talking with each other and in fact what they’re receiving these
homeowners who are trying to stay in their home and by the way let’s be clear
trying to pay to stay in their home they’re not looking for handouts what
they’re finding is that when in this dual track they are not getting
consistent information from the banks they can’t find anyone who can tell them
exactly what’s going on but they believe by being in the process of modification
that if they pay on the modified rate they can stay in their home invariably
we’ve met countless people who in that process working in good faith find that
someone’s knocking on their door saying your house is about to be sold I met one
young man who then the next day someone else knocked on his door and told him
his home had been sold on the front steps of the courthouse
so this first bill the foreclosure reduction Act will deal with that and
address that issue and essentially it will require creditors to establish the
right of foreclosure so they’re going to have to establish that they actually
have a right to foreclose on that home and we’re going to require that they
provide the homeowner with notice of the various stages of default sale so that
they the homeowner will have some understanding of what is happening with
the roof over their head this reform will also by the way and all of these
reforms are meaningful for a number of reasons including most importantly that
they reflect in large part the terms that were negotiated through the
national settlement but what’s very important to know is the national
settlement spans a course of three years only so that would not be permanent
reform what we are doing is taking the best of that settlement bringing it to
California but doing it in a way that will have lasting impact and will be on
our books and change the course so that this does not happen
again the second bill we are calling the homeowner due process rights act and
essentially it will give homeowners a transparency in the process and most
significantly it will give them a single point of contact these homeowners during
the course of this process end up talking to various people in each time
they talk with someone is someone different than who they talked with
before after they have shared all of their circumstances after they’ve poured
out their hearts so what we want to do is make it easier for the homeowner to
go through the process but just having a single point of contact it’s reasonable
it’s fair it will also create penalties that have not existed for the
robo-signing activity and we know what that was essentially it was
rubber-stamping foreclosures without doing the due diligence to determine
whether the homeowner in fact should be foreclosed upon what this bill will do
is create a penalty and hopefully therefore a deterrent to robo-signing
activity but it will find any robo-signing practice ten thousand
dollars per per loan the third bill we are calling the blight Prevention Act
and essentially it will allow and empower communities to tackle one of the
biggest challenges they’re facing around abandoned homes you go to Stockton the
police chief there told me that in the first six months of the year last year
they had over 200 reports of crimes occurring in abandoned properties that
ranged from homicide to rape blight is an issue that impacts not just the
immediate neighbors of that home but whole communities so what we will do
with this act is essentially create fines for owners of blighted properties
but we will also give new owners who buy those homes an extended period of time
instead of 30 days 60 days to resolve the health and safety issues that
surround that blighted home and in that way create incentives for them to
improve this is the situation and the status of those homes the fourth bill is
the tenants Protection Act very important although we often in this on
this issue of foreclosures talk about and think of the homeowners there are
many who are tenants we’re actually playing rent to live in those homes and
then the home is foreclosed upon and of course the the tenant is being evicted
and and ends up being on the streets what
this will do is pause any possible eviction of that tenant who is living in
that foreclosed home so that they will have instead of sixty days which is
California law 90 days after the foreclosure to be able to get their
lives in order and figure out their next steps and it will guarantee that the
renters lease will be honored in that process the fifth bill we are calling
the enhanced attorney general enforcement bill and essentially what we
will do is this we will create a new fund in the California Treasury by
levying a $25 fee on the banks on the servicers each time they record a notice
of default and that fund will then be the resource in which we will tap to do
the work that needs to happen around everything we have discussed from going
over and going after foreclosure scams and scam artists those predators who are
lawyers and brokers who are preying on these homeowners – what we are doing in
terms of the national work we are doing around addressing the misconduct and and
suspected misconduct by the servicers and and Freddie and Fannie the sixth and
final bill we’re calling a grand jury for California Financial Crimes so
obviously when we are talking about this issue we know that it ranges from from
Del Norte County to Imperial County it impacts our entire state and often we
are finding that the bad actors be they the subject of a criminal investigation
or a concern about consumer fraud or corporate fraud they’re working across
jurisdictional lines they’re not confining their activity to any one
County so it makes it difficult for us as law enforcement to address the issue
if we’re expecting that each da for example in each county we’ll just deal
with the issue and and and handle it fair so we need the ability of the tools
as the California Department of Justice to be able to go after this issue across
jurisdictional lines so we are creating the tool through this bill that will
allow us to convene a grand jury to go after back
conduct that crosses jurisdictional lines this is essential and and integral
to being able to make sure there will be consequences and accountability and most
importantly this grand jury will be for the purpose of going after crimes
against the state crimes against the public FISC and and so there you have it
and I’m gonna leave it I’m gonna now pass the mic over to our great assembly
speaker John Perez who again I can’t emphasize enough has been such a friend
and such a leader on this issue and and who has demonstrated great courage to
take it on in his role of leadership thank you Thank You Attorney General I am pleased
to join the Attorney General and the Senate President pro-tem to discuss the
important developments that we’ve seen in the area of foreclosure settlement
and quite frankly and laying the foundation for the next key steps I want
to congratulate the Attorney General on the victory that she had on behalf of
the people of California clearly but in changing the dialogue nationally and
making sure that the settlement that moved forward was in the best interest
in consumers across the country she used her leadership here in California not
only to advocate for our consumers but really to change and make stronger the
settlement for consumers across the country and to add the kind of stability
and predictability that we need as we move forward in dealing with these
issues we know that our state has suffered greatly as the results of bad
actors in the banking and financial industry’s areas and it’s clear that we
have much more work to do before we completely resolve the issues affecting
the housing industry in California and we know that far too many families are
still festa facing the threat of foreclosure
my colleagues and I under the leadership of the Pro Tem and myself will continue
to work with the governor in the Attorney General and our counterparts to
put forward the kinds of policies that you’ve just heard about now if you see
behind these are authors of different pieces of
the legislation who’ve been actively engaged in the questions we go revolving
foreclosure and housing stability Assemblymember Mike Davis senator friend
Pavley Assemblyman Mike Feuer Senator Mark Leno senator Lonnie Hancock
Assemblywoman Wilmer Amina Carter Assemblyman Mike yang
Assemblywoman Holly Mitchell and Assemblywoman nancy skinner each of them
are playing an active role in moving forward elements of the overall
homeowners Bill of Rights that the Attorney General just outlined but each
of them has been engaged more broadly in this issue and will continue to
demonstrate the type of leadership that is needed for consumers in the state of
California and quite frankly for our economy to recover as we continue to
stabilize this with that that it is clear that this is a effort that
requires the leadership of each of these authors the leadership and tremendous
success that our Attorney General has demonstrated in the leadership of our
Senate President Pro Tem Darrell Steinberg with that I’d like to ask him
to take over the microphone thank you thank you very much mr. speaker
it’s great and important that this be a bicameral effort and I hope in the end a
bipartisan effort to provide relief to tens of thousands of Californians who
desperately need it I also want to thank of course the Attorney General and echo
the speakers comments to go from the original version of the national
settlement to what California ended up with billions of dollars more of relief
for distressed homeowners is due to the persistence and tenacity of our Attorney
General and you know she could have just said well that’s enough for now move on
to another issue instead we’re here today because she recognizes that as
profound as that settlement is that there’s still more work to do and that’s
why we are here today and why I’m very happy to stand with you understand
my colleagues I want to thank the members as well with a special shout out
to Senator Mark Leno who has championed the dual tracking issue for a long long
time and it’s day has come and I’m very excited about working on this look if
there was ever a meat-and-potatoes middle class issue if there ever was a
crisis putting innocent hardworking people into dire circumstances this is
it the practice of expediency by too many in the mortgage lending industry
are the root of the pain for millions of California families and it has to end
these shouldn’t be complicated issues these are questions of basic fairness to
stop hurting innocent consumers if you’re upside-down on your mortgage and
you’re making a good-faith effort by going through loan modification the
banks and the lenders shouldn’t be allowed to commence foreclosure
proceedings at the same time it’s common sense is dual tracking and it has to
stop if you’re fighting to keep your home the bank employee shouldn’t be
allowed to forge signatures on sign off on foreclosures without verifying the
information for the sake of expediency that’s called Robo signing and it too
has to stop if you’re a renter who happens to be caught in the middle when
a lender forecloses on your landlord you shouldn’t be booted out after only 60
days that lender should not be allowed to ignore the lease
it takes away basic protection for tenants and it has to stop and if you’re
trying to settle problems with your loan you shouldn’t be shuffled from one bank
officer to another when all you’re trying to do how stressful this is right
all you’re trying to do is get basic information about your account in the
status of your mortgage that’s frustrating it’s unnecessary and it has
to stop for consumers this is much more than
just dealing with a few minor bumps in the road of balancing their family
budget home serves as the center of family life homeownership is the core of
how we define financial security as well and so
the Attorney General again has done incredible work in putting out a
template for what ought to apply to all mortgage lenders all banks and provide
protection for all consumers who find themselves in this most unfortunate
situation and with so many other issues that we deal with here it’s not just
about protecting the consumers that’s paramount innocent people but it’s also
about economic recovery what good is it that what good is it for California that
tens of thousands of people more people have to go through this what’s the good
for California that we have thousands of blighted properties in in neighborhoods
going unoccupied this is part of economic recovery we need to be
aggressive we need to be fair we’re gonna have to negotiate there’s no
question about it the legislature isn’t it and there’s never an easy
straight-line to get to to get to goal we know that but the time is now and
with the backing of the state’s top law enforcement officer what the work she
has done over the last several months this is the year thank you

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