The proposed legislation that would have made “dual track” foreclosures illegal in California was voted down last week. The California Homeowner Protection Act (SB 729) was designed to prevent lenders from simultaneously negotiating loan modifications and proceeding with the foreclosure process. This “dual track” system has spawned horror story after horror story of homeowners who believed they were going to be allowed to stay in their homes only to find their newly-modified payment checks rejected and their homes already in foreclosure. The bill failed in a tie vote in the Senate Banking and Financial Institutions Committee when one senator abstained from voting.
Although you might think that this is the end of the road for the Homeowner Protection act, the Senate has scheduled a new hearing for it this week. The bill has strong support from consumer advocacy groups and grassroots organizations that are demanding that something be done about the dual track system.
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