Attorney General Bonta Backs New Rules to Help Homeowners Avoid Foreclosure
Tuesday, September 10, 2024
Contact: (916) 210-6000 | agpressoffice@doj.ca.gov
OAKLAND — California Attorney General Rob Bonta, along with 19 other attorneys general, has voiced strong support for the Consumer Financial Protection Bureau’s (CFPB) proposed rules to enhance protections for homeowners at risk of foreclosure. The proposed regulations aim to safeguard homeowners struggling with mortgage payments by simplifying the pre-foreclosure process and ensuring critical information is communicated in languages that borrowers understand.
“Preventing unnecessary foreclosure is crucial, especially during California’s housing crisis,” said Attorney General Bonta. “The process of asking for help should be straightforward and accessible, not another hurdle for homeowners seeking relief. We must ensure that every Californian has the tools to understand and access the assistance they qualify for to remain in their homes.”
The CFPB’s proposed rules focus on providing clearer, more flexible foreclosure safeguards. They include measures such as:
- Streamlining the loss mitigation process to give mortgage servicers more flexibility when offering assistance.
- Enhancing transparency by ensuring borrowers are clearly informed about their options.
- Blocking the accrual of certain fees during the review process for loss mitigation.
- Improving language access for borrowers who do not speak English, allowing them to better understand available options.
The attorneys general also suggest several improvements to the rules, including:
- Setting deadlines for mortgage servicers to evaluate eligibility for assistance to avoid prolonged delays.
- Requiring servicers to communicate in simple, plain language to ensure borrowers understand the options available to them.
- Keeping loss mitigation options open for borrowers while other solutions are being considered.
- Extending protections to borrowers who face a significant financial change, potentially qualifying them for new assistance programs.
A copy of the letter can be found here.
