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Which California props passed

As California props up for the second round of Prop. 38 ballot initiatives, proponents are looking at this November’s election as the last chance for voters to pass a measure to help people facing foreclosure. For those who want to know more about this particular Prop. 38 initiatives and what they might see on the ballot, the following are five Prop. 38 facts you might not have known:

First, Prop. 38 is known as the “California Dream Act,” which would expand the definition of “foreclosure” to help families save their homes from the threat of forced foreclosure. Proponents say that if it becomes law, they believe it will prevent a family from losing its home, even if they haven’t made their mortgage payments for a set period. The bill also helps prevent families from having to pay back loans or mortgages that are in default.

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Prop. 38 was introduced to help California families

Second, Prop. 38 was introduced to help California families struggling to keep their homes through an initiative that requires lenders to give borrowers an extra three months to catch up on past payments. If the bill is not approved, lenders can have up to six months to recover defaulted money, which they may use to sell a home, although they would only receive a percentage of the sale price. If homeowners do not want to continue living in the house after three months, they can just stop paying the mortgage, meaning that they no longer own it.

Third, Prop. 38 also protects lenders from lawsuits that arise from a homeowner falling behind on a mortgage, preventing them from being forced to give up ownership of a home to avoid legal battles. A judge can only award the plaintiff a portion of what the lender actually owes and make them pay for any attorney’s fees, court costs, and any other costs not covered by the lawsuit. If the homeowners do not win their case, the lender does not have to pay any money to defend it. However, if the homeowners win, the lender must be willing to let go of the property.

Fourth, Prop. 38 requires that any bank that takes over a lender’s mortgage in foreclosure has to provide immediate notice to the new lender. This is an essential requirement because it makes sure that the original lender has to offer the same information to all foreclosed properties. Also, the new lender will have to take over the mortgage for a specified amount of time. If the homeowner does not get his or her loan modification approved in time, the bank must foreclose on the home.

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Prop. 38 protects borrowers from making monthly payments

Fifth, Prop. 38 protects borrowers from making monthly payments that are much larger than the amount of the original loan. This means that borrowers won’t have to pay more than 20 percent of the balance in interest or principal on the mortgage, which is what Prop. 38’s new provisions require. Instead, borrowers will be expected to make fixed monthly payments that will be a maximum of 30 percent lower than the current mortgage’s total amount. While the original loan could have been modified for this purpose, banks weren’t doing so.

Sixth, Prop. 38 is considered a measure that California Prop. 8 didn’t pass, so it won’t affect that measure. On the other hand, Prop. 40, a proposal that would have made it easier to get out of foreclosures by cutting the length of time homeowners have to wait for their home from being sold, passed.

Now that you know some of the facts about Prop. 38, make sure to keep reading for the other Prop. 38 points you need to know about this initiative.

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