Monday, 22 July 2024

Mortgage relief bill fails in state Senate

THIS STORY HAS BEEN CORRECTED REGARDING THE VOTE TALLY.

 

SACRAMENTO – A state bill meant to offer help to homeowners facing foreclosure failed to receive the necessary votes to pass the state Senate Wednesday.


The Senate voted 26-14 Wednesday in favor of Senate Bill 926 – one vote short of the number required to send the bill to the Assembly for consideration.


SB 926 is mortgage relief legislation authored by Senate President Pro-Tem Don Perata (D-Oakland) and North Coast Sen. Patricia Wiggins (D-Santa Rosa) is a co-author.


The bill sought to enact a comprehensive package of foreclosure reforms designed to prevent unnecessary residential foreclosures from further worsening the state and local economy and housing markets, according to David Miller, Wiggins' spokesman.


Specifically, the bill would have required a notice to be sent to borrowers prior to projected changes in mortgage payments, required lenders to contact borrowers to arrange an in-person meeting, and to provide a list of Housing and Urban Development-certified counselors to borrowers before filing a Notice of Default on a residential property in default, Miller reported.


The bill is an “urgency measure” designed to take effect immediately if signed into law by Gov. Arnold Schwarzenegger.


Urgency measures require two-thirds approval for passage, but while Democrats hold a 25-15 majority in the Senate, at least two Republican votes are needed to reach the two-thirds threshold. None voted to support SB 926 Wednesday, Wiggins' office reported.


Foreclosures reached a 20-year high in California during the fourth quarter of 2007, as a growing number of homeowners continue to fall behind on their mortgage payments.


According to La Jolla-based DataQuick Information Systems, lenders repossessed 31,676 residences in California in October-November-December 2007 – a 421.2 percent increase from the same period in 2006.


The research firm reported that Bay Area foreclosures rose 482.5 percent compared to the fourth quarter of 2006. Contra Costa County, Alameda County and Solano County experienced even greater increases than the Bay Area average.


Over the past year Lake County's foreclosure rates also have skyrocketed to record-high levels, as Lake County News has reported.


“California is facing an unprecedented threat to its state and local economies due to high foreclosure rates adversely affecting property values, and an estimated loss of $111 million in tax revenues due to foreclosures and their spillover effects,” Wiggins said. “SB 926 offered a reasonable approach to strengthening the economic health of California by modifying the foreclosure process to avoid additional unnecessary foreclosures.”


 

Miller said it's unclear if Perata and Wiggins will try reintroducing the bill this year.


Wiggins represents California’s 2nd Senate District, comprised of portions or all of six counties: Humboldt, Lake, Mendocino, Napa, Solano and Sonoma.


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