California Foreclosure Prevention Act Begins

Image by respres via Flickr

Last February the California legislature passed the California Foreclosure Prevention Act which in effect delays the foreclosure process at least 90 days and requires that mortgage lenders make an effort to keep borrowers in their home.

Loan companies must prove they tried to modify the delinquent loans before they can begin foreclosing. But supporters acknowledge the California Foreclosure Prevention Act won't stop thousands of foreclosures from eventually happening.

There have been more than 365,000 foreclosures in California since early 2007, with many more already scheduled. The bill passed in February and is similar to the Obama administration's Making Home Affordable Program that began in March. Both laws encourage lenders to cut interest rates or rewrite loans to affordable levels.

Sphere: Related Content