More housing help for California?
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The fact that California won’t be helped as much as most states by President Obama’s housing plan hasn’t been lost on folks. ‘Obama administration is urged to expand mortgage rescue,’ at latimes.com today, looks at one lawmaker’s call for expanding the parameters of the plan:
Amid concern that many Californians would not qualify for assistance from the federal anti-foreclosure plan, a powerful state legislator called on the Obama administration to make more homeowners eligible.The plan limits federal refinancing assistance to people who owe just a small amount, 5% or less, over what their homes are worth. But Assemblyman Ted Lieu (D-Torrance), who has a strong interest in lending issues, said Friday that that’s not enough to help Californians, many of whom owe significantly more than that.’Many distressed homeowners in California are underwater by more than 5% on their home loan, which makes them ineligible to apply for refinance assistance,’ said Lieu, author of a state foreclosure moratorium law that Gov. Arnold Schwarzenegger signed last week.
As for the California Foreclosure Prevention Act, you can read Lieu’s news release or the text of the bill for details. Basically, either the lenders offer loan modifications or they are subject to a 90-day foreclosure moratorium. This applies to owner-occupied homes at the time of delinquency, first mortgages issued between Jan. 1, 2003, and Jan. 1, 2008, and -- further muddying the waters on who will benefit -- lenders can apply for an exemption. It sunsets on Jan. 1, 2011.
-- Lauren Beale
Thoughts? Comments?