The California Legislature approved two bills that would help tenants who are on the verge of having their home foreclosed upon remain in their property for a longer period of time.
Assembly Bill 2610, sponsored by Nancy Skinner (D-Berkeley), and Senate Bill 1473, sponsored by Loni Hancock (D-Berkeley), will require purchasers of foreclosed homes to give tenants at least 90 days before starting any eviction proceedings.
SB 1473 passed the Senate on a 25 to 13 vote and AB 2610 passed the Assembly on a 54 to 13 vote. The bills that were passed make up California Attorney General Kamala Harris’s proposed California Homeowner Bill of Rights.
I’m Paying My Rent But My Landlord is in Foreclosure. How Long Do I Have to Move Out?
“Tenants are unsuspecting victims in the mortgage and financial crisis,” Harris said. “They pay rent on time but may suddenly find themselves forced to move. These bills will give tenants important rights and fair treatment when they live in a rental that is under threat of foreclosure.”
Under the bills, if the tenant has a fixed-term lease, the new owner must honor the lease unless the owner demonstrates that certain exceptions intended to prevent fraudulent leases apply.
Currently, there are disparities within state law, and between state and federal law, regarding eviction proceedings following a foreclosure. AB 2610 and SB 1473 would correct these confusing laws.
All provisions in the bill will remain in effect through 2019.
“Too often, California tenants are the unwitting victims when a home they are renting is foreclosed on,” Hancock said. “The inconsistency between state and federal law has left renters confused and, at times, misled about their legal protections. This bill provides common sense solutions to help protect California citizens caught in the crossfire of the mortgage foreclosure crisis.”
Skinner said more than 200,000 Californians were impacted from complexities between state and federal laws in 2010. “The Renters Right Act of 2012 protects families in rental housing by providing basis protections and legal rights in the face of unjust foreclosure-related evictions,” she added.
Also last week, the state Legislature unanimously approved two bills for the Golden State’s homeowner’s bill of rights that will protect state residents from mortgage scams.
These bills allow Harris to call special grand juries to investigate and indict alleged perpetrators of financial crimes involving victims in multiple jurisdictions.
Other portions of the proposed bill of rights are being considered in a Joint Legislative Conference Committee, including elements to restrict unnecessary foreclosures and protect the due process rights of borrowers and homeowners.
Adapted from National Mortgage News, Approved Bills Provide Greater Protection For California Homeowners, By Evan Nemeroff Jun 6, 2012 9:49am ET.