California Lawmakers Approve Foreclosure-Protection Law
California legislators yesterday approved a sweeping bill aimed at stopping abusive practices by mortgage lenders and helping homeowners avoid foreclosure, Reuters reported yesterday. The legislation, among the most ambitious of its type in the nation, would bar banks from moving ahead with foreclosures while still negotiating with homeowners over loan modifications, a practice known as "dual-tracking." It would also allow lawsuits against banks for so-called "robo-signing," in which foreclosure documents are signed en masse without review. Revelations about robo-signing helped lead to a $25 billion settlement of a multi-state foreclosure lawsuit against major banks. California Attorney General Kamala Harris, a central player in the foreclosure lawsuit settlement, also played a lead role in developing the legislation approved yesterday. Governor Jerry Brown (D) has not formally weighed in on the legislation, but he is expected to sign it in the coming days.