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California legislature halts foreclosures

By Cathy Moran

Legislation attached to the long delayed California budget halts foreclosures on family homes in a move designed to accommodate loan modifications.

According to the Legislative Analyst, the bill

  • prevents issuance of a notice of sale under CA foreclosure law for an additional 90 days beyond the statutory reinstatement period
  • applies only to first mortgages on homes that are the primary residence of the borrower when the default occurs
  • covers only loans recorded between 2003 and Jan. 2008
  • exempts servicers who have a qualifying loan modification program in place

From my perspective, the standards in the bill for a qualifying modification program are not very high and there is no requirement that  they are applied in a way calculated to actually modify the loan.

But half a loaf is better than where we are today.

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About Cathy Moran

I'm a veteran bankruptcy lawyer and consumer advocate in California's Silicon Valley. I write, teach, and speak in the hopes of expanding understanding of how bankruptcy can make life better in a family's future.

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You’ve arrived at the Bankruptcy Soapbox, a resource of bankruptcy information and consumer law.

Soapbox is a companion site to Bankruptcy in Brief, where I try to be largely explanatory and even handed (Note I said “try”).

Here, I allow myself to tell stories and express strong opinions. We dig deeper into how to consider bankruptcy and navigate a bankruptcy case.

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