New Foreclosure Law Aims to Give Renters Fair Chance at Homeownership

SB 1079, also known as “Homes for Homeowners, Not Corporations” has now been signed into law, and becomes effective January 1, 2021. The law seeks to balance out the advantages that corporations and Wall Street have in bulk purchasing foreclosed homes. We saw the devastating effects of this type of corporate greed during the Great Recession, and California lawmakers don’t want a repeat of that.

To this end, the new law does a couple things. Firstly, bulk purchasing is much more difficult, as bundle auctions will no longer be allowed except as permitted by security instruments. Second, eligible bidders and tenant buyers will have 45 days after the trustee sale to beat out the highest bid. Importantly, not listed among eligible bidders are for-profit corporations. Also of note, an eligible tenant buyer need only match, not exceed, the highest bid, and if they do so before the trustee sale ends, the sale is final. Though it doesn’t affect chances of homeownership, SB 1079 also increases fines for owners failing to maintain vacant properties.

Photo by Artem Beliaikin on Unsplash

More: https://journal.firsttuesday.us/foreclosure-requirements-shift-in-california/75113/

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