C.A.R.-sponsored bill that prevents banks from foreclosing after agreeing to a short sale scheduled for hearing next week
LOS ANGELES (April 26) – In another move to protect struggling California homeowners, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.), is sponsoring a bill so that homeowners who face losing their home and have negotiated a short sale in good faith with their lender or servicer are not forced to go through foreclosure.
Assembly Bill 1745 (Torres, D-Pomona) prevents lenders or servicers that have agreed to a “short sale” from foreclosing on a home. For any number of reasons (e.g., sickness, job loss, etc.), a homeowner may be unable to continue making his or her monthly mortgage payment. Rather than go through a lengthy and stressful foreclosure process, the homeowner will attempt to negotiate a “short” sale with the lender in which the lender agrees to accept less than the amount owed by the homeowner.
Foreclosures and short sales are usually handled by two different departments within banks. Unfortunately, these two departments often do not communicate with each other, which can frequently result in a homeowner being foreclosed upon, despite having previously negotiated a short sale with the same bank.
AB 1745 will likely result in banks implementing a dual tracking system to prevent foreclosing upon homeowners with whom they have already negotiated a short sale. The measure is scheduled for hearing on April 30 by the Assembly Banking and Finance Committee.
Leading the way...® in California real estate for more than 100 years, the CALIFORNIA ASSOCIATION OF REALTORS® (www.car.org) is one of the largest state trade organizations in the United States with 155,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.