CA Assembly Bill 278/Senate Bill 900
Legislation
State: California
Signed: August 27, 2012
Effective: January 01, 2013
Chapter: 86/87
Summary California becomes the first state to enact provisions from the National Mortgage Settlement into statute. The bill requires that certain foreclosure documents filed in court or recorded in the land records must be accurate and complete and provides a civil penalty of $7,500 for multiple instances of noncompliance.
AffectsAdds Section 2924.17 to the California Civil Code.
Changes - Requires that a specified declaration, notice of default, notice of sale, deed of trust, assignment of a deed of trust, substitution of trustee, or declaration or affidavit filed in any court relative to a foreclosure proceeding or recorded by or on behalf of a mortgage servicer shall be accurate and complete and supported by competent and reliable evidence.
- Provides that any mortgage servicer that engages in multiple and repeated violations – including filing affidavits and other notarized foreclosure documents that are inaccurate and incomplete – shall be liable for a civil penalty of up to $7,500 per mortgage or deed of trust, in an action brought by specified state and local government entities, and would also authorize administrative enforcement against licensees of the Department of Corporations, the Department of Financial Institutions, and the Department of Real Estate.
AnalysisCalifornia becomes the first state to enact provisions from the National Mortgage Settlement into statute. To be sure, the bill text does not use the term “robo-signing” or even “Notary Public,” but Section 20 of the bill addresses the document signing flaws that vaulted the foreclosure documentation crisis into the center of a media frenzy in October, 2010. The bill requires a declaration, notice of default, notice of sale, deed of trust, assignment of a deed of trust, substitution of trustee, or declaration or affidavit – common documents filed in support of a non-judicial and judicial foreclosure – that is filed in any court relative to a foreclosure proceeding or recorded by or on behalf of a mortgage servicer must be accurate and complete and supported by competent and reliable evidence. We are concerned primarily with the words “accurate” and “complete.” As the listed documents must be notarized, mortgage servicers must ensure that the entire document is accurate, including the notarization. California Notaries handling foreclosure documents must ensure these documents are complete prior to notarization, whether the notarization is an acknowledgment (currently required by statute) or jurat (currently not required by statute). Any repeated uncorrected violation exposes a mortgage servicer to a $7,500 civil penalty per deed of trust.
Read Assembly Bill 278.
Read Senate Bill 900.