Homeowner Legislative Update

Bill to Stop Tax on Loan Modifications Passes Legislature – updated 7/17/14
If the principal on your mortgage was reduced with a loan modification new legislation may lower taxes.
The Legislature has passed AB 1393 (Perea), a bill that will prevent homeowners from being charged state income tax when they’ve had a mortgage loan modified to reduce the principal. Under current law, the forgiven debt created by a reduction in principal as a result of a loan modification isn’t subject to federal income tax, but is currently taxable under state law. The bill has been passed by the state Legislature and awaits the Governor’s signature. If signed, it will become effective immediately and is retroactive to January 1, 2014. This is great news for homeowners. The CALIFORNIA ASSOCIATION OF REALTORS® supports this measure.
share  fbicon  twicon  inicon
-------
How Citigroup Settlement Affects Borrowers – updated 7/17/14
Citigroup settlement to provide money for consumer relief.

Citigroup has recently reached a $7 billion settlement with the U.S. Department of Justice for its role in the mortgage market meltdown. Of that, over $2.5 billion is set aside nationwide for consumer relief. Here’s some great information in the San Jose Mercury News about how the settlement affects California homeowners who had loans underwritten or serviced by Citi and what to do if you may be eligible to file a claim.
share  fbicon  twicon  inicon
-------
Coastal Commission Suit May Set Precedent Affecting Property Rights – updated July 7/17/2014
Lawsuit affecting property rights to be considered by Court of Appeals.

A lawsuit involving the California Coastal Commission, which regulates property in the coastal zone, is scheduled to be heard soon by a San Diego Appeals court. Because the decision will be made by an Appeals court, it may eventually affect property owners up and down the coast. Two homeowners in Encinitas had applied to the Coastal Commission for a permit to rebuild a sea wall damaged in a storm. In order to receive the permit, the Coastal Commission required that the permit application be re-submitted in twenty years. If the permit was then rejected, the homeowners would have to then take down the sea wall. The property owners filed suit to nullify that requirement. A local judge deciding the initial case referred to the Coastal Commission’s requirement as a “power grab.” Learn more about the case in the Los Angeles Times.
share  fbicon  twicon  inicon
-------
Pro-Consumer, Anti-“Shill Bidding” Bill Considered in Senate – updated 6/20/14

Real estate auction companies increasingly are being used to sell real estate.  Some lenders require homeowners to agree to use an auction company to see if the property fetches a higher price at auction before a short sale offer will be accepted. One aspect of the auction that is not commonly known is that the auction company may place a bid on behalf of the seller – or a “shill” bid – to artificially drive residential and commercial property prices up.

The CALIFORNIA ASSOCIATION OF REALTORS® is sponsoring AB 2039 (Muratsuchi), which would prohibit “shill bids” and make clear that only legitimate bids may be placed on behalf of a seller; otherwise, the seller bid must be disclosed to the all bidders as a bid which cannot be accepted to complete the sale of the property.  The measure has passed the Senate Judiciary Committee but faces stiff opposition from the auction companies.
share  fbicon  twicon  inicon
-------
Legislature Reviews Bill to Allow Seniors and Disabled to Postpone Property Tax– updated 6/20/14

Until 2009, the Senior Citizens and Disabled Citizens Property Tax Postponement Law allowed the Controller to postpone payment of property taxes for those qualified property owners who applied for the program. AB 2231 has been introduced to re-establish the Senior Citizens and Disabled Citizens Property Tax Postponement Fund within the State Treasury. AB 2231 provides individuals who are on a fixed income, such as senior citizens or disabled individuals, a program to which they can turn for assistance with paying their property taxes, allowing them to stay in their homes.  Beginning on July 1, 2015, qualified individuals with at least 40% equity in their home may file a claim with the Controller to postpone the payment of their property taxes. Applications will be accepted until January 1, 2016, and the postponed tax amount will be filed as a lien against the property. AB 2231, which is supported by the CALIFORNIA ASSOCIATION OF REALTORS® is being considered by the state Senate.
share  fbicon  twicon  inicon
-------
Bill Introduced to Prevent Homeowner Associations from Imposing Unnecessary Document Fees – updated 6/20/14

Often, when purchasing a home in a common interest development (CID) like a condominium, the Home Owners Association, in an attempt to generate more revenue, will “bundle” unnecessary documents with those that are actually required and then charge excessive fees for the “bundle.”  AB 2430 (Maienschein) will provide more specific document delivery and disclosure standards and tighten the anti-bundling provisions in connection with condominium sales and HOA document delivery requirements so that those buying or selling homes in CIDs aren’t charged for more documents than are required. This bill is sponsored by the CALIFORNIA ASSOCIATION OF REALTORS®.
share  fbicon  twicon  inicon
-------
Legislature Considers Bills to Prevent Fines for Underwatering Landscaping updated 6/20/14

Under current law Homeowners Associations (HOAs) can create rules and regulations dictating the responsibilities of separate interest owners to maintain their yards and can impose fines if these rules are not followed. Two bills currently being considered by the state legislature, AB 2100 and SB 992, would prohibit an HOA from imposing fines for under-watered lawns and plants during a period for which the Governor has declared a drought emergency.  Proponents of the measures believe residents of HOAs in CIDs should be permitted to undertake landscape modifications that foster more efficient water usage without risking a monetary fine by the HOA. The CALIFORNIA ASSOCIATION OF REALTORS® supports these measures.
share  fbicon  twicon  inicon