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California Legislative Update

The California Legislature has recently enacted legislation regarding closing an equity line of credit, amendments to the Survivor’s Bill of Rights, amendments to the Property Assessed Clean Energy (“PACE”) Program, amendments to the California Military Families Financial Relief Act (“ACT”) and amendments to the Right to Financial Privacy Act.  All the legislation discussed in this […]

The California Legislature has recently enacted legislation regarding closing an equity line of credit, amendments to the Survivor’s Bill of Rights, amendments to the Property Assessed Clean Energy (“PACE”) Program, amendments to the California Military Families Financial Relief Act (“ACT”) and amendments to the Right to Financial Privacy Act.  All the legislation discussed in this memorandum is effective January 1, 2019.

 

CALIFORNIA SENATE BILL 1139

 

Section 2943.1 of the California Civil Code, which discusses a Borrower’s Instruction to Suspend and Close Equity Line of Credit became operative July 1, 2015 and was to be repealed July 1, 2019.  This legislation deletes the section repealing the statute.  Therefore, Section 2943.1 will be in effect indefinitely.

 

CALIFORNIA SENATE BILL 1183

 

The Survivors Bill of Rights which provides procedural protections for successors in interest going through the foreclosure process has been amended.

 

The law requires lenders to notify heirs of deceased borrowers that they may qualify as successors in interest and assume the mortgage.  The law has been amended to exempt reverse mortgages from this requirement.

 

CALIFORNIA ASSEMBLY BILL 1284

 

Program administrators that administer a PACE program on or behalf of a public agency are now required to be licensed by the Commissioner of Business Oversight (“Commissioner”) under the California Financing Law (previously known as the Finance Lenders Law).  Program administrators must now meet similar requirements for licensees under the Financing Law related to the conduct of his or her business including, among other things:

  • Display of his or her license;
  • Location of his or her business;
  • Maintenance and preservation of his or her records;
  • Reporting, including filing a specified annual report under oath;
  • Prohibition on making false or misleading statements; and
  • Advertising restrictions.

 

A program administrator is subject to disciplinary actions including enforcement authority for violations of the California Financing Law (formerly the Finance Lenders Law) subject to certain requirements and procedures.

 

California Senate Bill 2521

 

The Act authorizes a reservist who is called to active duty to defer payments on mortgages, credit cards, retail installment accounts and contracts, real property taxes and assessments, vehicle leases, and obligations owed to utility companies, for the period of active duty plus 60 calendar days, or 180 days, whichever is less.  In order for an obligation or liability to be subject to deferment, the reservist or his or her designee must deliver to lender:

  • A copy of his or her activation or deployment order and any other information that substantiates the duration of the service member’s military service, and
  • A written request by the reservist for a deferment of financial obligations. An electronic communication is considered a written request.

 

CALIFORNIA ASSEMBLY BILL 3229

 

The Right to Financial Privacy Act has been amended to allow the California Department of Justice to access certain information when investigating whether a crime has been committed.

 

A special agent with the California Department of Justice may now request specified financial information from a bank, credit union, or savings association when the department is investigating the financial abuse of an elder or dependent adult.

 

 

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Diane Jenkins

Director, National Mortgage Compliance Practice Group, AsurityDocs Of Counsel, Sandler Law Group

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