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Urgency legislation that took eect immediately on August 31, 2020.
Requires servicers to comply with applicable federal guidance regarding COVID-19 forbearance.
Servicer must comply with special notice and information requirements if a forbearance is denied.
restitution and attorney fees as a separate legal right under California law.
A mortgage servicer shall comply with applicable federal guidance regarding borrower options following a COVID-19 related forbearance as provided by the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac), the Federal Housing Administration of the United States Department of Housing and Urban Development, the United States Department of Veterans Aairs, or the Rural Development division of the United States Department of Agriculture.
With respect to a nonfederally backed loan, a mortgage servicer is required to review a customer for a solution that is consistent with the guidance to servicers as provided by the above entities. However, It is the intent of the Legislature that a mortgage servicer oer a borrower a post forbearance loss mitigation option that is consistent with the mortgage servicer’s contractual or other authority.
A borrower who is harmed by a material violation of this law may bring an action to obtain injunctive relief, damages, restitution, and any other remedy to redress the violation and reasonable attorney’s fees and costs to the prevailing party.
If the mortgage servicer denies a forbearance request, they are required to explain why if the request was made before April 1, 2021. The servicer must specically identify any curable defect in the written notice; Provide 21 days from the mailing date of the written notice for the borrower to cure any identied defect; Accept receipt of the borrower’s revised request for forbearance before the aforementioned 21-day period lapses and; Respond to the borrower’s revised request within ve business days of receipt of the revised request.
This law applies only to 1) Mortgages or deeds of trust outstanding at the time of enactment that secure residential 1 to 4 property, and 2) Borrowers who are natural persons and not to REITS, corporations or LLCs unless the property contains deed- restricted aordable housing units.
These provisions were part of a larger bill Assembly Bill 3088 and are codied as Civil Code Sections 3273.01, 3272.1, 3273.2 and 3273.10 through 3273.16. Eective immediately on August 31, 2020, as urgency legislation.
24 The Greater San Diego Association of REALTORS®