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  • SB1150: HSBOR Survivor Bill of Rights

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    If you have been living in a property for a recently deceased homeowner for at least 6 months, you may have rights to litigation.

    Demystifying the Homeowner’s Bill of Rights

    The Homeowner Survivor Bill of Rights seeks to address the egregious conduct of mortgage servicers and banks that refuse to recognize the rights of surviving homeowners concerning their family houses. JT legal firm has sought to understand HSBOR by studying its background, provisions, processes, and weaknesses.

    Background

    California was the first state to acknowledge certain rights for homeowners under the Homeowner Bill of Rights. The HBOR bill introduced single point of contact, a concept that sought to nullify dual tracking of borrowers. In dual tracking, homeowners were driven to foreclosure even while their loans were in active loss mitigation. The Homeowner Bill of Rights reduced cases of wrongful foreclosure in 2013 and helped stabilize local economies, neighborhoods, and families. However, despite the improvements made by HBOR, there is room for improvement. In California like in other states in the U.S., studies have shown that widowers, widows, and the surviving family of a deceased borrower are facing wrongful foreclosure because their mortgage servicer fails to consider them for any loss mitigation efforts.

    Homeownership is the main way that Americans build wealth for their families and for themselves. The failure by the government to protect surviving children and spouses ruins a family's ability to secure their financial future and transfer wealth to other generations. The most common scenario is that a surviving widower or widow owns their home but they are not listed on the home's mortgage loan. When the survivor applies for a loan assumption and inquires about options on loan modification, the mortgage servicer refuses to talk with them, complicates the application process, and creates a series of bureaucratic processes that result in the eviction of the survivor without considering any alternatives to foreclosure.

    The Provisions of the HSBOR

    The surviving family has the right to assume responsibility for mortgage loans affecting their homes. They deserve to receive accurate information and clear communication after the demise of their loved one. The Homeowner Survivor Bill of Rights sets out the responsibilities of lenders in the event that a borrow dies and leaves behind a surviving homeowner who intends to assume responsibility for the loan. JT Legal Group offers foreclosure defense to the surviving family of a deceased borrower based on these stipulated provisions. These responsibilities are:

    • To request the survivor's identity and the documentation on the borrower's death

    • Provide accurate information on foreclosure avoidance and loan assumption

    • Engage the lender in a single point of contact and provide follow-up on communication

    • Allow a survivor to apply for both loan modification and loan assumption

    How Does the HSBOR Work?

    The Homeowner Survivor Bill of Rights is applicable to deeds of trust and lien mortgages secured by owner-occupied residential property. Owner occupied means the borrower's main residence leading to the time of his/her death. Successor in interest means the person who informs the servicer about the demise of the borrower and has documentation to prove that he/she is the spouse, partner, adult child, parent, grandchild or grandparent or adult sibling of the borrower. Furthermore, the interested successor must have lived in the property in question, as their main residence for six months before the death of the borrower.

    JT Legal Group helps survivors who may be facing foreclosure. To see if JT Legal Group can assist you with your .

    Determining the Successor

    When the servicer is notified about the borrower's death, they should not proceed with foreclosure until they have completed the process of determining the successor in interest. The Homeowner Survivor Bill of Rights states that the foreclosure delay period should be no less than 120 days. When the servicer is notified about the death of the borrower, they should request for written evidence of the borrower's death. The bill affords survivors 30 days to present this documentation. Evidence of the borrower's death is mainly in form of a death certificate along with other relevant written evidence. After the death of the borrower is proven, the servicer should request for written proof that a party is indeed the borrower's successor. The bill affords survivors 90 days to prove their status.

    If the servicer proceeds with any foreclosure proceedings while determining if the original borrower is dead, if the party has a rightful interest in the deceased borrower's property, or if the party has resided in the home for a period of six months before the borrower passed away, the servicer may be breaking the law under SB1150: HSBOR.

    The Main Weakness: Delaying Foreclosing

    When a servicer has been notified about a borrower's death, the process of confirming the death of the borrower and the legality of the party's claim as a successor takes a total of 120 days. The bureaucracy involved with recognizing a survivor as the rightful owner of the house is both expensive and wastes a lot of time. There is a need to streamline the requirements and process needed to help successors avoid wrongful foreclosure and assume the mortgage loan of a deceased borrower's home.

    Questions in regard to the HSBOR should be done with an attorney who knows the provisions and determining factors of the Homeowner Survivor Bill of Rights.

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    Armine Singh

    Armine Singh is the Managing Attorney at JT Legal Group. Armine has defended hundreds of homeowners from foreclosure through successful real estate litigation defense. Click below to schedule a free consultation.

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