That is the question that banks should worry about in the state of California in this foreclosure scandal. On July 8, 2008, Governor Arnold Schwarzenegger signed SB1137.
Here is the summary:
Summary
Prior to filing a notice of default, lenders must contact borrowers to set up a meeting where the lenders and consumers will discuss potential ways to avoid foreclosure.
Applies to loans made between January 1, 2003 and December 31, 2007, when most of the loans that are causing the problems we face today were made.
Tenants will get notice (in six different languages) once a notice of sale has been posted on a property.
The bill increases the current notice required to be given to residential tenants of foreclosed properties to 60 days prior to eviction.
Locals can impose a $1,000-per-day fine on financial institutions that don't maintain vacant properties if problems are not fixed within 14 days.
On February 27, 2009 , the Governor signed lieu Foreclosure Prevention Act APX2 7. The bill imposed a 90 day foreclosure moratorium unless a lender offers a comprehensive loan modification program designed to keep homeowners in their homes. Read on.
The real question is how much it will cost in penalties and lawsuits to the banks. JP Morgan Chase CEO had announced last week that he set aside $1.4 billion for litigation and lawsuits. By the way, the other banks didn't announce as of yet that I know of that they will set aside monies for litigation and lawsuits. I wouldn't be surprised if those banks follow Chase's path if another shoe drops in this scandal. By Chase setting aside monies for litigation and lawsuits simply tells me that they know that they did something wrong and will settle the lawsuits and will admit no wrongdoing. That is the world of the corporation: Settle lawsuit, move on, and admit no wrongdoing. But, of course, the banks are looking at lawsuits that have been filed civil. What the banks are not looking is that DOJ and Attorney Generals are looking at criminal acts also and not just civil acts.
Summary
Prior to filing a notice of default, lenders must contact borrowers to set up a meeting where the lenders and consumers will discuss potential ways to avoid foreclosure.
Applies to loans made between January 1, 2003 and December 31, 2007, when most of the loans that are causing the problems we face today were made.
Tenants will get notice (in six different languages) once a notice of sale has been posted on a property.
The bill increases the current notice required to be given to residential tenants of foreclosed properties to 60 days prior to eviction.
Locals can impose a $1,000-per-day fine on financial institutions that don't maintain vacant properties if problems are not fixed within 14 days.
On February 27, 2009 , the Governor signed lieu Foreclosure Prevention Act APX2 7. The bill imposed a 90 day foreclosure moratorium unless a lender offers a comprehensive loan modification program designed to keep homeowners in their homes. Read on.
The real question is how much it will cost in penalties and lawsuits to the banks. JP Morgan Chase CEO had announced last week that he set aside $1.4 billion for litigation and lawsuits. By the way, the other banks didn't announce as of yet that I know of that they will set aside monies for litigation and lawsuits. I wouldn't be surprised if those banks follow Chase's path if another shoe drops in this scandal. By Chase setting aside monies for litigation and lawsuits simply tells me that they know that they did something wrong and will settle the lawsuits and will admit no wrongdoing. That is the world of the corporation: Settle lawsuit, move on, and admit no wrongdoing. But, of course, the banks are looking at lawsuits that have been filed civil. What the banks are not looking is that DOJ and Attorney Generals are looking at criminal acts also and not just civil acts.
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