For all workers, home ownership is a cornerstone of economic security. But the rise in predatory mortgage lending and the collapse in the housing market have left many working families in California on the brink of disaster. Whether facing foreclosure or a devastating loss in the value of one's home, California families are among the hardest hit in the nation. Foreclosures in California increased six-fold between 2006 and 2007. Owning a home that we can pass on to our children is part of the American Dream that we believe in and fight for.
SB 1137 (Perata) would provide immediate assistance to those at risk of foreclosure. If enacted, it would give notice to property residents that the foreclosure process has begun, provide tenants additional time to move from a foreclosed property and mandate maintenance of foreclosed properties to diminish the impact on the value of neighboring homes. SB 1137 was approved by the State Senate in late April. If it is passed by the Assembly and signed into law by the governor, the measure would take effect immediately.
AB 1830 (Pieu) would establish new standards to prevent families from being victimized by predatory mortgage lending. AB 1830 will make sweeping changes to the mortgage industry, all of which shared some part in causing the current mortgage meltdown. The bill would require lenders to determine if the borrower has the ability to pay over the life of the loan, and would ban loans where the borrower pays less than the accrued interest, leading to an increase in the principle. It would also prohibit brokers from taking kickbacks, and would outlaw prepayment penalties (which have stopped many borrowers from refinancing risky loans.)
Hundreds of thousands of working families are at risk of losing their homes due to subprime lending practices. Families must be offered tools to help save their homes and standards for the lending industry must be established to prevent this type of crisis from happening again. These bills would protect working families today while imposing new standards on the industry to protect working families from predatory mortgage lending practices in the future.
Additional information:
Tips on Avoiding Home Foreclosure
California Reinvestment Coalition
Publications and Reports on Home Foreclosures
Contacts
- Angie Wei, Legislative Director (Workers' Compensation)
- Caitlin Vega, Legislative Advocate (Wage and Hour, Public Employees, Low Wage Worker Issues, Underground Economy, Right to Organize, Immigration)
- Jeremy Smith, Legislative Advocate (Family Leave, Worker Health and Safety, Offshoring, Election Reform, Labor Education, Green Jobs, Toxics in the Workplace)
- Emily Clayton, Policy Coordinator (Healthcare)
- Shawna Manning, Legislative Office Manager