SB 818 would renew mortgage and foreclosure protections, such as the right to appeal when a loan modification application is denied.

SACRAMENTO, CALIF. – The California Senate Banking and Financial Institutions Committee has voted to pass SB 818, a bill to restore key provisions in California’s landmark “Homeowner’s Bill of Rights” (HBOR) legislation which passed in 2012 in response to the foreclosure crisis. HBOR has prevented thousands of avoidable foreclosures by requiring mortgage loan servicers to engage in timely, fair and transparent process with struggling homeowners before proceeding to foreclosure. The bill’s sponsor is Senator Jim Beall (D-San Jose), who introduced the bill after concerns that HBOR has been weakened by the 2017 legislative sunsets. 

“This bill will reinstate important safeguards to help families stay in their homes as California continues to fight the ongoing housing crisis,” said Center for Responsible Lending California Policy Director Graciela Aponte-Diaz. “Foreclosures have rattled our housing market, especially for owners who’ve been hit hard by natural disasters. Homeowners need protection against procedural abuses—this bill helps us accomplish that goal. I commend Senator Beall for his continued leadership in making homeownership a top priority and thank the Senate banking committee for their decisive action to push this bill forward.”

Background on SB 818

Before the original HBOR became law in California, loan servicers regularly engaged in a range of unfair practices that needlessly forced thousands of homeowners into premature, avoidable foreclosure. California’s HBOR successfully curbed many of these practices by making sure financially distressed homeowners received basic “due process” when trying to save their homes. Many of provisions in HBOR lapsed earlier this year.

SB 818 would restore are critical protections against dual tracking – when servicers simultaneously enter loan modification negotiations with borrowers while continuing foreclosure. The bill also continues other HBOR protections, including:

  • The right to appeal the denial of a loan modification application 
  • Requirements that loan servicers provide homeowners with written notices to confirm receipt of their loan modifications applications and whether any necessary application items are missing. 
  • Requirements that servicers send written denial notices with sufficient information and sufficient time to appeal a questionable denial. 

For more information, or to arrange an interview with a CRL spokesperson on this issue, please contact Ricardo Quinto at