Governor Urged To Sign Mortgage Reform Bill

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(Sacramento, CA)
Wednesday, September 23, 2009
A bill (AB 260) aimed at reducing home foreclosures in California is getting a final push from supporters. 

Lawmakers sent the measure to Governor Schwarzenegger’s desk, but its fate is uncertain because he vetoed a similar bill last year. 

Capital Public Radio's Steve Shadley reports...
Los Angeles area Democratic Assemblymember Ted Lieu says his bill would give home buyers added protection from risky subprime mortgages.  

He says it also would tighten regulations on prepayment penalties that some lenders can charge people who pay off their loans early. 

Despite the foreclosure crisis, Lieu says there still aren’t many state laws protecting home buyers from predatory lending practices...
Lieu   “If you remember, three, four, five years ago...anyone could get a loan under one condition and that was if you could breathe oxygen you could get a loan. 
So, what this bill does is it goes and really cracks down on some of those worse practices. 
That way they have to put a fiduciary duty on the owners or the broker so they just don’t start giving loans to anybody that walks through their door..”
Governor Schwarzenegger vetoed a nearly identical bill last year. He said it didn’t give the California Attorney General additional authority to investigate mortgage firms.  

But, Lieu says he’s made the changes the governor wanted. A spokesman for the governor’s office says he’s still reviewing the measure. 

The governor has until October 11th to take action on the bill.