Attorney Kamala D. Harris is trying to pass legislation against the mortgage companies to “help” consumers and communities cope with our state’s foreclosure crisis.
Although in theory it does sound like the miracle that most of our homeowners who are facing foreclosure have been wishing for, when we dug deeper we found that everything from the proposals to the plans are poorly thought through, and riddled with loopholes. With a settlement of $18 billion dollars that is only good for 3 years, and must be shared amongst all the states, Kamala is trying to pass six bills offering homeowners more protection.
The first of the proposed bills is to create fairness in the mortgage process, including an end to dual-track foreclosures. Right off the bat it is easy to see where this is going, a bill touted “to create basic standard of fairness in the mortgage process” is very vague, and its enforceability is unsure as it is ambiguous at best. A perfect example of where this “bill” will fail is simply the fact that without defining the word “fair”, lenders are left to enact what they consider to be fair practices for homeowners; and who really believes that is going to be truly fair?? Even if Kamala’s intentions are good how is she going to do enforce this? And with what money? Same questions apply to the dual-track foreclosure process. Although it would be ideal for homeowners to feel secure about pursuing a loan modification without the worry about their home foreclosing, how are they going to stop the lenders from doing so? What laws are they going to pass?
The second proposed bill is to create transparency in the mortgage workout process, including a single point of contact for homeowners. This is something that has already been implemented by the big players in the industry; and as many of us in the “industry” already know this system does not work. In fact I would go so far as to say it has made the process worse, as now we are forced to deal with employees who are inexperienced and serve as messengers. We used to be able to deal with the incompetent employees first and then move on to the employees who could answer our questions; now we are stuck dealing with the incompetent employees who have to relay our questions to their supervisors. This is a flop of an idea if anyone ever had one!
The next bills’ purpose is to improve community tools in an effort to prevent blight after banks foreclose on homes. Where are they going to setup these “tools”? Where are they going to come up with the money to set them up? Are we (those who are unemployed, have had pay curtailment, or have already been foreclosed on) going to pay higher taxes for these tools? The higher our taxes are, the less our spending is, the poorer our economy gets. How long are we going to have to pay for the banks mistakes?
The 4th bill is to protect tenants after foreclosures. Right now tenants have on average 60 days from the date of foreclosure to vacate the home. Kamala is trying to extend that to 90 days. This is a mere 30 days from the original eviction date. Is this really going to help anyone?
The 5thbill proposes enhanced law enforcement to defend homeowner rights, which will be paid for by fees imposed on banks. This action is going to trickle down to the consumers, hitting their already empty pockets. The lenders are not going to let the government add a new form of taxation without making up for it somewhere else! We already have to pay for checking accounts, I wonder what they will start charging for to offset this one. Trust me they will make up for their losses one way or another, and we will all pay.
The last proposed bill is to create a “special grand jury” to investigate financial and foreclosure crimes. In recent years many homeowners have unjustly lost their homes due to improper foreclosure practices. While it would be justice to investigate these wrongful practices, it again is going to be very time consuming and difficult to pull off. Additionally it will cost a lot of money to fight these big corporations, and what will this amount to? A few homes saved, while the majority will stay in foreclosure? Is it really worth the time and money when it will inevitably end in a disappointing outcome (as was the result of the last case the federal government and the states brought against the banks)?
Lastly I would like to ask all of you a question: is it coincidence that Kamala has come up with these miraculous proposals right before an election? Is this not similar to all the other promises being made by politicians around the country? Let’s not be naïve; sorry Kamala but these promises sound pretty empty!
Contributor, designer & admin for JohnHart Gazette.
