SACRAMENTO, Calif. – The Center for Responsible Lending, a consumer group financed by Self-Help CU, is lobbying state lawmakers for legislation that would protect borrowers from misdeeds of mortgage servicers.
The bill, which is scheduled to a hearing before the Senate Banking, Finance and Insurance Committee this week, would do two things. It would bar loan servicers from starting the foreclosure process until a homeowner has received an up or down decision on their modification, if they requested one; and it would provide remedies to those homeowners whose homes were lost due to serious servicer errors.
“A foreclosure that starts because a servicer's left hand doesn't know what the right hand is doing is the most preventable foreclosure of all,” said Paul Leonard, director the Center for Responsible Lending’s Oakland office, where Self-Help has built a $175 million credit union from the combination of four community development credit unions in the past two years. “And when those foreclosures end with homeless borrowers, simple fairness dictates that servicers right those wrongs.”
“It's unacceptable that when servicers lose faxes and lose payments, some Californians lose their homes,” said Caryn Becker, policy counsel with the CRL California office. “At nearly 1 million foreclosures and counting, we need to prevent every unnecessary foreclosure we can.”
