California Homeowner Bill of Rights


The California Homeowner Bill of Rights (CHBR) is designed to protect homeowners who are trying to modify their mortgages or sell their homes as a Short Sale. The CHBR, effective January 1, 2013, creates guidelines for most mortgage servicers who start a foreclosure following a default on a:
 •    First Deed of Trust,
 •    Owner-occupied,
 •   1 to 4 unit residential property.

Prohibits Dual-Tracking
A lender is prohibited from continuing with the foreclosure process:
 •   While a completed first lien loan modification application is pending, or
 •   A short sale has been approved.

Provides a Single Point of Contact
When a borrower requests a foreclosure prevention alternative, a mortgage servicer must:
 •   Establish a single point of contact, and
 •   Provide the borrower with one or more direct means of communication with them.

Notice of Postponement of Trustee Sales
If a Trustee Sale has been postponed, a lender must give the borrower:
 •   Written notice of the new sale date and time.

Approvals Binding on Successors
If a loan modification or short sale has been approved and the loan is sold to another lender:
 •   The subsequent mortgage servicer is required to honor any previously approved foreclosure          prevention alternative.

No Fees Allowed
While a foreclosure prevention alternative is being considered lenders may not collect :
 •   Application fees, or
 •   Late fees.

Disclosures Required
Prior to recording a Notice of Default (NOD) and within 5 days after recording a NOD, lenders must:
 •   Give the borrower a notice that explains their alternatives to foreclosure.

Violations of the California Homeowner Bill of Rights Homeowners may:
 •   Seek an injunction and damages for violations of the CHBR
 •   File a complaint with the California Department of Real Estate if the violator holds a real estate license.

For more detailed information about the California Homeowner Bill
of Rights consult a real estate attorney or California’s Office of the
Attorney General’s web site: oag.ca.gov

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