The California Homeowner Bill of Rights (HBOR) helps protect homeowners who might lose their homes. The law makes banks give each homeowner one main person to talk to, stops banks from moving forward with home taking while looking at loan changes, and requires banks to send clear written warnings before taking a home. If banks break these rules, homeowners can go to court and get up to $50,000. Knowing these rights helps homeowners fight back against wrongful home taking.
Key Takeaways
- HBOR requires lenders to halt foreclosure proceedings while reviewing a complete loan modification application, preventing dual tracking practices.
- Homeowners must receive written notice 30 days before foreclosure begins, giving time to explore alternatives and seek assistance.
- Banks must assign a single point of contact for struggling homeowners, ensuring clear communication throughout the loan modification process.
- Homeowners can take legal action to stop foreclosure sales and receive up to $50,000 in damages for HBOR violations.
- Lenders must provide written explanations for loan modification denials and allow homeowners time to appeal these decisions.
What Is the California Homeowner Bill of Rights?
The California Homeowner Bill of Rights (HBOR) helps protect people who own homes during their dealings with mortgage companies and when facing possible foreclosure.
These laws, which started in 2013, make sure banks and lenders treat homeowners fairly by talking clearly with them and looking at ways to avoid foreclosure before taking away their homes.
Under these rules, lenders must give each struggling homeowner one main person to talk to about changing their loan terms.
They also must send a written notice before they start the foreclosure process.
If homeowners ask to change their loan terms, lenders must fully review these requests before moving ahead with foreclosure.
These rules make banks more open about their actions and hold them responsible for treating homeowners fairly.
Key Protections Under HBOR for California Homeowners
California’s Homeowner Bill of Rights gives homeowners key legal protections when dealing with mortgages and foreclosure. These rules help protect homeowners and ensure they get fair treatment during financial struggles.
| Protection | What It Means | How It Helps |
| One Main Contact | Bank must assign one person to help | Makes it easier to get answers |
| No Double Actions | Bank can’t foreclose while reviewing loan changes | Gives homeowners time to find solutions |
| Proof Required | Bank must send written notice before foreclosure starts | Stops mistakes from happening |
| Right to Take Action | Homeowners can sue if banks break the rules | Holds banks accountable |
The law makes sure banks follow clear steps and gives homeowners ways to defend their rights when money gets tight.
Understanding Dual Tracking and How to Stop It
Before, banks could try to foreclose on homes while also looking at ways to help homeowners keep their houses.
Now, California’s Homeowner Bill of Rights stops this unfair practice.
Banks must pick one path – they need to fully review requests for help before they can start or continue taking someone’s home.
Banks must: – Let homeowners know within 5 working days that they got their request for help – Stop the foreclosure process while reviewing a complete request to change loan terms – Face lawsuits from homeowners if they break these rules
These safeguards stay in place until homeowners have tried all available options to save their homes.
Required Steps Lenders Must Take Before Foreclosure
Under California law, lenders must provide homeowners with specific pre-foreclosure notices that clearly state the borrower’s rights and include detailed information about the default and options to cure it.
Before initiating foreclosure proceedings, lenders are required to make good faith efforts to contact the borrower to assess their financial situation and explore alternatives to foreclosure.
The law mandates that lenders conduct a thorough evaluation of all available loss mitigation options, including loan modifications, before pursuing foreclosure actions.
Pre-Foreclosure Notice Requirements
The California Homeowner Bill of Rights sets rules about how banks must notify homeowners before starting a foreclosure.
Banks must send specific written notices to homeowners at certain times.
The bank must: – Send a Notice of Default at least 30 days before filing a Notice of Sale – Tell homeowners in writing about ways to avoid foreclosure before recording a Notice of Default – Explain in writing why they turned down any requests to modify loans, tell homeowners they can appeal, and keep proof they sent these notices
These rules make sure homeowners get proper warning and have time to look for other options before losing their homes.
Mandatory Loss Mitigation Evaluation
Before starting foreclosure in California, lenders must look at ways to help struggling homeowners keep their homes.
They need to review all possible options like changing loan terms, pausing payments, or selling for less than what’s owed.
Each borrower gets one main person to talk to at the bank about their situation.
Banks cannot move forward with foreclosure at the same time they’re reviewing a complete request to change loan terms.
This rule helps make sure homeowners get a real chance to save their homes before foreclosure begins.
Your Rights During the Loan Modification Process
When homeowners ask to change their home loans in California, the law helps protect them during the whole process. Clear rules make sure banks look at each case fairly and can’t start taking away homes while they review changes to the loan.
Banks must: – Give borrowers one main person to talk to about their loan – Allow 30 days for homeowners to challenge if they’re turned down – Wait until they’ve tried all ways to fix the loan before taking the home
These rules make the process clear and honest, which helps California homeowners feel more secure when trying to change their loans.
Legal Remedies and Enforcement of HBOR Violations
When mortgage companies break California’s Homeowner Bill of Rights (HBOR), homeowners can take strong steps to protect themselves.
They can ask courts to stop a foreclosure sale, get money back for their losses, and receive up to $50,000 in penalties – or three times their losses if the company knowingly broke the rules. If homeowners win their case, the company must also pay for their lawyer and court costs.
To fight foreclosure, homeowners can file complaints with state officials who watch over mortgage companies.
They can also take the company to court. Judges can order mortgage companies to fix their mistakes and follow the rules before they try to foreclose on a home.
Steps to Take When Your HBOR Rights Are Violated
When California homeowners identify potential violations of their HBOR rights, they must immediately document all relevant details and communications with their mortgage servicer.
Maintaining thorough records includes saving copies of letters, emails, phone call logs, and any other correspondence that demonstrates the servicer’s non-compliance with HBOR requirements.
Swift legal action through qualified counsel is crucial, as HBOR cases typically have specific timeframes within which claims must be filed to preserve legal remedies.
Document HBOR Violations Today
When you think your mortgage company might be breaking California Homeowner Bill of Rights (HBOR) rules, you need to gather proof right away to protect your rights.
Good records make your case stronger and help you get the legal help you deserve under HBOR laws.
- Write down every time you talk to your mortgage company – put the date, time, who you spoke with, and what was said
- Keep all letters, notices, and papers from your mortgage company in one folder
- Take pictures of your online account pages and save copies of any forms you fill out
Take Legal Action Fast
Act Quickly to Protect Your Rights
If you think your loan company broke HBOR rules, you need to take action right away. Foreclosures happen fast, and you only have a short time to fight back in court.
| What to Do | When to Do It |
| Call a lawyer | First 24 hours |
| Write down what happened | First 48 hours |
| Submit your case | Within 5 days |
| Ask court to stop sale | Before house is sold |
Under California law, you can sue for HBOR rule-breaking either before or after your home is sold. But if you want the court to stop the sale, you must file papers well ahead of the sale date. If you win your case, you can get money back, plus the other side must pay for your lawyer and court costs.
Frequently Asked Questions
Does the Homeowner Bill of Rights Apply to Commercial or Investment Properties?
The California Homeowner Bill of Rights only covers homes where people actually live as their main residence. It doesn’t protect commercial buildings or properties bought to make money through rentals or resale. The law focuses on helping homeowners who live in their houses, not business owners or investors.
How Long Does Protection Under HBOR Last After a Loan Modification?
The California Homeowner Bill of Rights (HBOR) protects homeowners for three years after they receive a loan modification. During these three years, if a homeowner falls behind on payments again, mortgage companies must carefully follow certain rules before they can start a new foreclosure.
Can Landlords Use HBOR Protections When Renting Out Their Primary Residence?
HBOR protections do not cover rental properties, including homes where landlords used to live. The law only helps homeowners who live in the home as their main residence right now.
Are Reverse Mortgages Covered Under the California Homeowner Bill of Rights?
Reverse mortgages are protected by the California Homeowner Bill of Rights, which helps owners keep their homes when facing money problems. While these loans get the same basic protections as regular home loans, the rules about when and how lenders must notify borrowers, and the timing of various steps, can be different.
What Happens if I File Bankruptcy While Protected Under HBOR?
A bankruptcy filing puts an immediate stop to foreclosure actions, even when you’re covered by HBOR rules. But mortgage companies can still ask the court for permission to restart the foreclosure once your bankruptcy case begins.
Conclusion
The California Homeowner Bill of Rights offers crucial protections if you’re facing foreclosure. Our team at Ace California Law helps homeowners understand these legal safeguards so they can defend themselves against unfair lending practices and foreclosure procedures. By keeping good records, responding quickly to notices, and knowing your legal options, you can use HBOR’s protections to keep your home and stop wrongful foreclosure actions.
