NTC Weighs in on California Homeowner Bill of Rights

Nationwide Title Clearing Inc. has released a new White Paper that provides insight into California Assembly Bill 278, a controversial new law commonly referred to as the California Homeowner Bill of Rights. An analysis by NTC Chief Legal Officer Myron Finley indicates that California’s new law is a clear indication that the mortgage servicing industry will ultimately be required to comply with the requirements of the historic, $25 billion National Mortgage Settlement. “There is little doubt that the provisions of the California Homeowner Bill of Rights will materially alter the contours of the mortgage lending industry in that state,” Finley writes in the paper. “Moreover, as other states watch its implementation and the effects it has on that industry, it could well become a model for mortgage reform in those states. Anyone involved in the mortgage industry will be well advised to watch this issue to see how it impacts the nature of mortgage lending and servicing in the future.” The paper offers an analysis of the California law, its likely impact on industry documents (including Notice of Defaults), dual tracking for defaulted loans, staffing (especially regarding Single Point of Contact), and provides a framework for evaluating a servicer’s current assignment review process. It also provides an overview of the law’s requirement that all foreclosure prevention alternatives be exhausted before foreclosure commences.