CRL Update on Mortgage/Consumer Finance Legislation

Paul Leonard provides this update on 2009 California Mortgage/Consumer Finance legislation:

Since my presentation at the Working Families Policy Summit, the Center for Responsible Lending has sponsored 1 bill.

Existing law requires mortgage brokers to provide a translated summary form of key mortgage terms to the borrower when the mortgage was negotiated in one of 5 non-English languages. This would expand the existing translation requirements to include lenders. The bill has passed out of the Assembly Banking, Finance & Insurance Committee and is headed to Assembly Judiciary.

• We support SB 94 (Calderon) which would eliminate advance fees for anyone purporting to engage in loan modification services for a borrower.

• We support AB 329 (Feuer) and SB 660 (Wolk), both of which provide greater protections to seniors in connection with a reverse mortgage transaction. We are concerned that reverse mortgages could be the next wave of predatory lending as brokers and lenders seek out seniors who have significant equity in their homes, and who may be more vulnerable to abuse.

• We are working with partners on AB 260 (Lieu) which, among other things, seeks to end mortgage broker abuses by codifying their fiduciary duty to borrowers, and prohibiting them from steering. Although AB 260 lacks some of the key reforms that would truly change the market, it contains important protections for borrowers.

• We are working with partners to end predatory and abusive payday lending, and are monitoring AB 545 (Salas) and AB 377 (Mendoza) to ensure the passage of only real, meaningful reform that would end the payday lending debt trap.

We are tracking other mortgage and consumer finance bills that have been introduced this year, with the goal of eliminating abusive products and practices in the market place, while promoting policies that protect home ownership and family wealth.  Click here for a complete legislative update.