A state law imposing a 90-day moratorium on some California home foreclosures takes effect today.
But it’s not all-inclusive. The law lets state regulators grant loan servicers and lenders exemptions if they have a mortgage modification program in place that meets state requirements of reducing mortgage payments to no more than 38 percent of a borrower’s income.
Other requirements include:
• The loan was recorded between Jan. 1, 2003 to Jan. 1, 2008;
• The loan is the first mortgage or deed of trust;
• The borrower occupies the property as their principal residence when the loan becomes delinquent; and,
• The Notice of Default (NOD) has been recorded on the property.
Loans that are exempted under the moratorium include: loans purchased, serviced, or used as collateral by CalHFA; loans where the borrower has surrendered the property, contracted with an organization regarding how to extend the foreclosure process, or filed bankruptcy and the case has not been closed or dismissed.
