90 Day Foreclosure Freeze for California

In the 3^rd quarter of 2008 over 80,000 homes went into foreclosure – that’s a tragedy times 80,000 families. Governor Schwarzenegger has presented a new proposal to put a 90 day freeze on foreclosures; it is his attempt to encourage lenders to make aggressive loan modification programs available to homeowners who are on the road to foreclosure. If lenders can prove that they have aggressive loan modification programs available and putting them into use, they can exempt themselves from the freeze.

Many lenders have been offering loan modifications to homeowners, but no where near as aggressive as they should be to help slow down the wave of foreclosures hitting California. Schwarzenegger is hoping to help guide loan services to adopt a more systematic approach to loan modifications. He also is asking that there be reform across the board for loan originators, requiring them to go through a standardized program to become licensed and expand their fiduciary duties towards consumers.

The 90 day freeze may not be the total answer, but at least it is a decent attempt to assist those facing credit ruin and foreclosure.