David Lagstein, Homeowner Bill of Rights
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David Lagstein, Homeowner Bill of Rights


>>>>PEGGY: THE HOME OWNERS BILL OF RIGHTS
PASSED THE CALIFORNIA LEGISLATURE ON MONDAY. HOME OWNER ADVOCATES CLAIM IT IS A VICTORY
AND SAY IT’S A BLOW TO BIG BANKS. GOVERNOR BROWN SAYS HE’LL SIGN THE LEGISLATION,
BUT THE SKEPTIC IN ME WONDERS HOW MUCH THIS BILL WILL HELP THE HOME OWNERS IN TROUBLE
TO HELP ANSWER THAT QUESTION IS MY GUEST DAVID LAGSTEIN, DIRECTER OF SAN DIEGO’S ALLIANCE
OF CALIFORNIA FOR COMMUNITY EMPOWERMENT, OR ACE.
I WANTED TO KNOW IF IF YOU CAN GIVE US A BRIEF BIG PICTURE OF HOW THIS BILL OF RIGHTS RELATES
TO THE SETTLEMENT THAT RECENTLY HAPPENED IN CALIFORNIA, FIVE BANKS, 18ÊBILLION DOLLARS
TO CALIFORNIA HOME OWNERS. HOW DOES THAT RELATE?
>>>>DAVID LAGSTEIN: THE SETTLEMENT WAS A MULTISTATE SETTLEMENT UNDER ATTORNEY GENERAL
HARRIS. PART OF IT HAD BEST PRACTICES BANKS WOULD
BE REQUIRED. THIS LOCKS IN THE REQUIREMENTS AT THE STATE
LEVEL AND HAS STRONGER ENFORCEMENT WHEN BANKS DON’T FOLLOW THEM.
>>>>PEGGY: SO PUTTING AN ENFORCEMENT HOOK INTO THAT.
AS FAR AS THE NUTS AND BOLTS OF THIS BILL OF RIGHTS BECAUSE IT SEEMS LIKE IT’S PRETTY
INTENSIVE, WHAT ARE SOME OF THE FEW KEY PROVISIONSÊ AND I’M WANTING TO START WITH THE DUEL TRACKING
IF YOU COULD EXPLAIN THAT.>>>>DAVID LAGSTEIN: DUEL TRACKING IS REALLY
AN INSIDIOUS PRACTICE OF BANKS WHERE THERE’S TWO PARTS OF THE BANK; ONE NEGOTIATING MODIFICATION
WITH THE HOME OWNER, ASKING FOR PAPERWORK, THE OTHER SIDE IS MOVING A FORECLOSURE THAT
SAME TIME. WHAT THIS STOPS THE BANK IF YOU’RE NEGOTIATING
A MODIFICATION, YOU CAN’T FORECLOSE AT THE SAME TIME.
>>>>PEGGY: IT SEEMS LIKE THEY’RE USING IT BOTH WAYS TO THEIR BENEFITS.
>>>>DAVID LAGSTEIN: THAT’S EXACTLY RIGHT. WE’VE SEEN CASES WHERE THE FORECLOSURE NOTE
OW OWS ARRIVES IN THE MAIL ONE DAY AND A MODIFICATION TWO DAYS LATER.
>>>>PEGGY: AND A LOT OF PEOPLE HAVE MENTIONED THAT, OR THEY’VE FORECLOSED AND THEN THEY
GOT MODIFICATION NOTICES AFTERWARDS. THERE’S ALSO A REALLY BIG ONE, AND THIS I
KNOW PERSONALLY BECAUSE I’M TRYING TO BUY A HOME. THE ONE PURSE ON F CONTACT.
>>>>DAVID LAGSTEIN: THIS PROVIDE AS SINGLE POINT OF CONTACT FOR A HOMEOWNER TRYING TO
RECEIVE A MODIFICATION. YOU GET A DIFFERENT PERSON EVERY SINGLE TIME,
LOST PAPER WORK, AND THIS IS ACTUALLY ABOUT CREATING SOME SANITY FOR THE BORROWER THEY
CAN HAVE A COHERENT PATH TO RENEGOTIATE THEIR LONE.
>>>>PEGGY: THERE’S SOME FINANCIAL PENALTIES IF THEY DO NOT COMPLY WITH THESE RULES INCLUDING
A 7,500 DOLLAR PENALTY FOR VERIFYING LOAN DOCUMENTATION APPROPRIATELY.
WHAT COMES TO MINE IS THAT COMPUTER SIGNING. DOES IT APPLY TO ROBO SIGNING, AND WHAT ELSE?
>>>>DAVID LAGSTEIN: NO, THIS IS U IMOWT ROBO SIGNING.
THERE’S A NUMBER OF DIFFERENT WAYS WHERE LOANS HAVE BEEN FILED INAPPROPRIATELY, THE SIGNATURES
WITH WEREN’T DONE PROPERLY, AND THIS HAS SOME PENALTY FOR IT.
IMPORTANTLY FOR ANY VIOLATION THE LAW, GIVEN THE BORROWER OR OPPORTUNITY TO SUE THE BANK.
THE BANK HAVE PROVEN IF THERE’S NOT A PENALTY OR CONSEQUENCES FOR THEIR BEHAVIOR, THEY’RE
GOING TO DO THE SAME THING. THIS GIVES LEVY LEVERAGE FOR THE BANKS TO
MAKE RIGHT BY THE BORROWER.>>>>PEGGY: IS 7500 ENOUGH OF A PENALTY?
>>>>DAVID LAGSTEIN: ULTIMATELY, WHATÊ THIS BILL IS NOT GOING TO PREVENT EVERY FORECLOSER,
BUT IT WILL CREATE FAIR TREATMENT.>>>>PEGGY: I WANT TO MOVE QUICKLY TO THE
OPPONENTS OF THE BILL OF RIGHTS THAT SAY FORECLOSURE IS INEVITABLE, WE KNOW THAT IT’S MARKET VALUES,
THINGS LIKE THAT. ISN’T THIS JUST DRAGGING OUT THE PROCESS,
MAKING IT PAINFUL FOR THOSE PEOPLE GOING THROUGH FORECLOSURE.
>>>>DAVID LAGSTEIN: I HAVE TO SAY THAT ARGUMENT CONFUSES ME, BECAUSE WHY IS TREATING A BORROWER
FAIRLY SEEN AS DRAG OUT THE PROCESS. THIS IS NOT ABOUT SAVING EVERY FORECLOSURE,
BUT A PERSON SHOULD BE ABLE TO CALL THE BANK, SEND DOCUMENTS, REQUEST A MODIFICATION.
THE ANSWER IS NOT ALWAYS GOING TO BE YES, BUT SHOULD BE A STRAIGHT AND CLEAN FORWARD
PROCESS.>>>>PEGGY: I WANTED TO GET TO THAT THIS IS
A SIGNIFICANT PIECE OF LEGISLATION, IF THE GOVERNOR SIGNS THIS, WE’LL BE THE FIRST STATED
THAT HAS THIS KIND OF PROVISION. WHY IS IT SO SIGNIFICANT?
>>>>DAVID LAGSTEIN: THIS REAL THE BANK SPENT A TON OF MONEY TO LOBBY LEGISLATURES, GRASS
ROOTS FROM EFFORT FROM PEOPLE AROUND THE STATE. IT LOOKS LIKE IT’S GOING TO BE A MODEL FOR
LEGISLATION TO PROTECT HOME OWNERS AROUND THE COUNTRY.
THEY HAD TO DECIDE WERE THEY ON THE SIDE OF WALL STREET OR HOME OWNERS.
WE’RE REALLY PROUD TO PLAY A PART OF THIS VICTORY.
>>>>PEGGY: IS THIS THE END OF THE STORY?>>>>DAVID LAGSTEIN: THERE’S A LOT MORE WORK
TO BE DONE. PRINCIPLE REDUCTION FOR HOME OWNERS STABILIZES
THE HOUSING MARKET, FIX THE ECONOMY, BUT THAT’S THE NEXT STEP IN THE PROCESS.
THIS IS DEALING WITH FORECLOSURES IN THE PIPE LINE BUT DOESN’T SOLVE THE BIGGER ISSUE.
>>>>PEGGY: MAYBE MAKES THE PATH A LITTLE BIT EASIER.
THANK YOU SO MUCH FOR JOINING ME.

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