California Legislature Urged To Strengthen Statutes Regulating Foreclosure Rescue

In Northern California, the sixth in a series of editorials on elder financial abuse in the Contra Costa Times urges the State of California to pass AB 1356, a law that would strengthen the current laws regulating foreclosure rescue operators in California. An excerpt from the article:

• The Legislature can and must take a major step now to curb foreclosure rescue abuses. AB 1356 would have done just that, but the law fell victim to petty politics. For starters, it would have required foreclosure rescuers to clearly let people know in bold letters that they would no longer be the homeowner.

• It would have also required that equity sales contracts be recorded with the county. That would have prevented foreclosure rescuers from selling the property to a third party who knew nothing about the individual's option to repurchase the property.

• Finally, the law would have mandated that anyone signing an equity sales contract must first undergo pre-loan counseling. Homeowners going through foreclosure are in a panic. They don't know where to turn. They're not thinking clearly. They often don't realize that there may still be time to salvage some of the equity. They have a tendency to hunker down and hide, ignoring notices from their lender. Yet what they should do is contact the mortgage company to try to work something out. Foreclosure rescuers pressure homeowners not to talk to anyone but them. Their game is to run out the clock until it's too late for homeowners to get real help. It's time to derail the foreclosure rescue gravy train. The Legislature must revive and pass AB 1356.

For more, including a story of an elderly couple facing foreclosure who had the equity in their home stripped, and ultimately lost their home after doing business with a foreclosure rescue operator called Bridgeport Capital Management in Irvine, see Theft of Elder Nation: An editorial series - Place legal curbs on 'rescue' practice.

Go here for all posts and links to this Contra Costa Times editorial series on elder financial abuse.

Go here for the proposed statute, AB 1356; and here for Bill Analysis on AB 1356.

For California's current state law regulating foreclosure rescue operators, see:

• California Home Equity Sales Contract Act - Section 1695 through Section 1695.17 of the California Civil Code;
• California Mortgage Foreclosure Consultants Act - Section 2945 through Sction 2945.11 of the California Civil Code.

Go here , go here , and go here for other posts on elder financial abuse. xero