BILL NUMBER: AB 244	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Eggman
   (Coauthor: Assembly Member Brown)

                        FEBRUARY 9, 2015

   An act to amend Section 2920.5 of the Civil Code, relating to
mortgages and deeds of trust.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 244, as introduced, Eggman. Mortgages and deeds of trust:
successors in interest.
   Existing law imposes various requirements to be satisfied prior to
exercising a power of sale under a mortgage or deed of trust.
Existing law defines a mortgage servicer as a person or entity who
directly services a loan, or is responsible for interacting with the
borrower, and managing the loan account on a daily basis, as
specified. Existing law defines a borrower, for purposes of specified
provisions relating to mortgages and deeds of trust, as a natural
person who is a mortgagor or trustor who is potentially eligible for
any federal, state, or proprietary foreclosure prevention alternative
program offered by, or through, his or her mortgage servicer.
   This bill would include a successor in interest in the definition
of a borrower for purposes of the eligibility provisions described
above. The bill would define a successor in interest for these
purposes as a natural person who provides the mortgage servicer with
notification of the death of the mortgagor or trustor and reasonable
documentation, as specified, showing that the person falls into one
of four categories of successors, including a personal representative
of the mortgagor's or trustor's estate or a surviving spouse, as
specified.
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 2920.5 of the Civil Code, as added by Section 2
of Chapter 87 of the Statutes of 2012, is amended to read:
   2920.5.  For purposes of this article, the following definitions
apply:
   (a) "Mortgage servicer" means a person or entity who directly
services a loan, or who is responsible for interacting with the
borrower, managing the loan account on a daily basis including
collecting and crediting periodic loan payments, managing any escrow
account, or enforcing the note and security instrument, either as the
current owner of the promissory note or as the current owner's
authorized agent. "Mortgage servicer" also means a subservicing agent
to a master servicer by contract. "Mortgage servicer" shall not
include a trustee, or a trustee's authorized agent, acting under a
power of sale pursuant to a deed of trust.
   (b) "Foreclosure prevention alternative" means a first lien loan
modification or another available loss mitigation option.
   (c) (1)  (A)    Unless otherwise provided and
for purposes of Sections 2923.4, 2923.5, 2923.55, 2923.6, 2923.7,
2924.9, 2924.10, 2924.11, 2924.18, and 2924.19, "borrower" means any
natural person who is a mortgagor or trustor  , or who is the
successor in interest to the mortgagor or trustor following the death
of the mortgagor or trustor,  and who is potentially eligible
for any federal, state, or proprietary foreclosure prevention
alternative program offered by, or through, his or her mortgage
servicer. 
   (B) For purposes of this subdivision:  
   (i) "Successor in interest" means a natural person who provides
the mortgage servicer with notification of the death of the mortgagor
or trustor and reasonable documentation showing that the person is
one of the following:  
   (I) The personal representative, as defined in Section 58 of
Probate Code, of the mortgagor's or trustor's estate.  
   (II) The surviving joint tenant of the mortgagor or trustor. 

   (III) The surviving spouse of the mortgagor or trustor if the real
property that secures the mortgage or deed of trust was held as
community property with right of survivorship pursuant to Section
682.1 of the Civil Code.  
   (IV) The trustee of the trust that owns the real property that
secures the mortgage or deed of trust or the beneficiary of that
trust.  
   (ii) "Notification of the death of the mortgagor or trustor" means
provision to the mortgage servicer of a death certificate or, if a
death certificate is not available, of other written evidence of the
death of the mortgagor or trustor deemed sufficient by the mortgage
servicer.  
   (iii) "Reasonable documentation" means copies of the following
documents, as may be applicable, or, if the relevant documentation
listed is not available, other written evidence of the person's
status as successor in interest to the real property that secures the
mortgage or deed of trust deemed sufficient by the mortgage
servicer:  
   (I) In the case of a personal representative, letters as defined
in Section 52 of Probate Code.  
   (II) In the case of a surviving joint tenant, an affidavit of
death of the joint tenant or a grant deed showing joint tenancy.
 
   (III) In the case of a surviving spouse where the real property
was held as community property with right of survivorship, an
affidavit of death of the spouse or a deed showing community property
with right of survivorship.  
   (IV) In the case of a trustee of a trust, a certification of trust
pursuant to 18100.5 of the Probate Code.  
   (V) In the case of a beneficiary of a trust, relevant trust
documents related to the beneficiary's interest.  
   (C) Designation of a successor in interest as a borrower for
purposes of this subdivision does not impose an affirmative duty on a
mortgage servicer to offer a loan modification to, or accept an
assumption of the loan by, the successor in interest and does not
alter any obligation the mortgage servicer may otherwise have to
accept an assumption of the loan by the successor in interest. If a
successor in interest assumes the loan, he or she may be required to
otherwise qualify for available foreclosure prevention alternatives
offered by the mortgage servicer. 
   (2) For purposes of the sections listed in paragraph (1),
"borrower" shall not include any of the following:
   (A) An individual who has surrendered the secured property as
evidenced by either a letter confirming the surrender or delivery of
the keys to the property to the mortgagee, trustee, beneficiary, or
authorized agent.
   (B) An individual who has contracted with an organization, person,
or entity whose primary business is advising people who have decided
to leave their homes on how to extend the foreclosure process and
avoid their contractual obligations to mortgagees or beneficiaries.
   (C) An individual who has filed a case under Chapter 7, 11, 12, or
13 of Title 11 of the United States Code and the bankruptcy court
has not entered an order closing or dismissing the bankruptcy case,
or granting relief from a stay of foreclosure.
   (d) "First lien" means the most senior mortgage or deed of trust
on the property that is the subject of the notice of default or
notice of sale.