Members of the Silicon Valley Association of REALTORS® were happy to learn about the passage of the new foreclosure relief bill, signed into law this month by Governor Schwarzenegger.
"SB 1137 addresses the adverse effects of high foreclosure rates in California," said Leannah Hunt, president of the Silicon Valley Association of REALTORS®. "This mortgage relief bill is an urgency measure that provides immediate relief to homeowners and tenants whose properties are in foreclosure."
Under the new law, lenders are required to have contact with homeowners to explore options to avoid foreclosure. They must also contact borrowers to schedule telephone or in-person meetings on restructuring options before beginning the foreclosure process. The law applies to loans made between January 1, 2003 and December 31, 2007.
The law also gives tenants living in foreclosed properties additional time before eviction and requires foreclosed properties to be properly maintained.
"The new law is an important and much needed step to helping borrowers, renters and communities," Hunt said.
The new law requires foreclosed properties to be properly maintained. Financial institutions will be required to pay a $1,000-per-day fine if they don't maintain vacant properties and if problems are not fixed within 30 days. "Failure to maintain" includes failure to care for the exterior of the property, failure to take action to prevent trespassers or squatters on the property, or failure to prevent mosquito larva from growing in standing water.
Tenants will receive notification (in six different languages) once a notice of sale has been posted on a property. The new law extends the time for residential tenants to move out of properties that have been foreclosed upon from 30 to 60 days, unless other laws apply. These requirements will remain in effect until January 1, 2013.
Foreclosures continue to increase across California. According to a report from RealtyTrac, the leading online marketplace which collects and aggregates foreclosure data, one in every 192 California properties received a foreclosure filing in June, the nation's second highest state foreclosure rate and 2.6 times the national average. Foreclosure filings were reported on 68,666 California properties in June, down nearly 5 percent from the previous month but still up nearly 77 percent from June 2007.
Seven California metro areas were in the top 10, and the top three rates were in California: Stockton, with one in every 72 households receiving a foreclosure filing; Merced, with one in every 77 households receiving a foreclosure filing; and Modesto, with one in every 86 households receiving a foreclosure filing. Other California metro areas in the top 10 were Riverside-San Bernardino at No. 5; Vallejo-Fairfield at No. 7; Bakersfield at No. 8; and Salinas-Monterey at No. 10.
The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.
The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.
Variations of this article have appeared in local area newspapers.
For further information, please email or call the SILVAR office at (408) 200-0100.