|Critics say the banking lobby |
killed SB 1275 in the assembly
Most observers in favor of Sen. Mark Leno's foreclosure bill called it "modest." The piece of legislation that would have afforded troubled borrowers a decision on whether they were approved for a loan modification was inexplicably voted down last week by state Republicans and many liberal members of the assembly.
East Bay assemblymembers Mary Hayashi, Alberto Torrico and Joan Buchanan all voted against SB 1275. Along with the 38 noes recorded Aug. 26, 13 members shielded themselves from criticism by abstaining, including San Francisco's Fiona Ma and two Democrats who recently failed in attempts to rise within the party's power structure--Kevin De Leon and Hector De La Torre. East Bay Sen. Ellen Corbett voted in favor of the bill in June on both the Senate floor and appropriations committee. Corbett also has a bill regarding the foreclosure process currently awaiting the governor's signature.
A consumer watchdog group reported 20 lobbyists of the banking industry crawling about the assembly floor as the vote was taken last week. Various banking interests had argued the bill would add higher levels of complexity to the foreclosure process and open mortgage servicers to a bevy of frivolous lawsuits. But, during the process of possible notice of foreclosure, many borrowers reeling from a poor economy, were forced to make monthly mortgage payments to their banks when their homes were ultimately foreclosed upon anyway.
A few editorials have taken shots at Hayashi, Torrico, Buchanan and Ma for their votes, saying they amount to treason against the ideals of their party, which traditionally espouses looking out for those with the least. Furthermore, what makes this foursomes vote more disconcerting is they all belong to minority groups the bill would have greatly helped. According to the Center for Responsible Lending, between 2004 and 2008, Latinos and African American mortgage holders accounted for 35.6 percent of home loans in California, but made up of over half of the number of foreclosures. Both groups also have disproportionally far higher loans rates than any other demographic.
The home is where the heart is, so to speak. Without one, studies have clearly shown; education, health and public safety eventually turns for the worse, making these lawmaker's no votes on SB 1275 one of the most ill-advised and potentially harmful for the residents of their Bay Area districts.
UPDATE: Aug. 30, 2010, 3:45 p.m. Information on Corbett's senate bill was added.