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California fights back against the foreclosure scourge

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By : John Smith    99 or more times read
The California legislature is throwing its weight behind Obamaís ongoing efforts to stem the foreclosure crisis on a number of State and local government fronts. The latest efforts by Senator Mark Leno and President Tem Darrell include a Bill aimed at giving distressed home owners more opportunities to beat the foreclosure blues. The Bill was advanced by the California Senate Banking, Finance and Insurance Committee on Wednesday, removing one more impediment to it becoming law.

Leno and Darrellís efforts had received further moral support the day before, when the San Jose City Council joined forces with the Housing Trust of Santa Clara County to unlock $25 million of pending Federal support waiting to assist neighborhoods under the foreclosure hammer.

Letís hope these two initiatives thwart the tidal wave of foreclosures that are putting Californian Americans out of their homes while they cause severe collateral damage to the neighborhoods they once lived in.

The mortgage disaster, for indeed it has become one, is a matter for public debate and a test for public policy makers. Foreclosures are far more than a spat between financially irresponsible borrowers and unbending lenders Ė theyíre also changing the social landscape as nearby neighbors face tumbling property prices and derelict yards around abandoned homes.

Itís just not good enough for banks to walk away from the mess they helped create. Whatever happened to the friendly socially responsible jingles they previously used to advertise their services?

Several San Jose neighborhoods including Alum Rock Edenvale have been savaged by foreclosure knock-on effects which have come on top of already shrinking budgets. Letís hope the $25 million granted through the American Recovery and Re-Investment Act will be wisely spent and help as many Californian Americans as possible. With this in mind, Alum Rock has combined forces with the Silicon Valley Housing Trust and Neighborhood Housing Services to create San Jose Neighborhood Stabilization Program, with the avowed intention of optimizing community participation. The new body plans to take over and rehabilitate approximately 250 foreclosed and abandoned homes in the next three years before selling them on to low and moderate income buyers.

The pending Californian State Legislation contains two important provisions. When passed, all mortgage providers in the state will be legally compelled to complete loan modification evaluations before they will be allowed to start the foreclosure process. The second provision will put a stop to a gap in the law that currently prevents foreclosed borrowers from reversing foreclosures caused by service provider errors, and give them a way to right the wrong.

Itís hard to believe that, right now, lenders foreclose before the evaluation process has been completed, and walk away from their own mistakes leaving a family in the street. Letís hope America will never be the same again.

Thatís not to say that Federal homes programs havenít moved the situation forward. At least the banks are finally beginning to feel the pressure, and, if all these efforts come together, we can start keeping Americans in their homes again.
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