This law requires a real estate licensee to disclose his or her DRE license number on all “solicitation materials intended to be the first point of contact with consumers” and on real property purchase agreements when acting as an agent in those transactions.

It defines "solicitation materials intended to be the first point of contact with consumers" to include:

^. business cards,
^. stationery,
^. advertising fliers, and
^. other materials designed to solicit the creation of a professional relationship between the licensee and a consumer.

Excluded from the definition are the following:

^. an advertisement in print or electronic media,
^. "for sale" signs, and
^. specified classified rental advertisements.

Amended Business and Professions Code Section 10140.6.

FCC Order 08-239A
Order Implementing the Junk Fax Prevention Act of 2005
(eff. 10/14/08)

The Federal Communications Commission (FCC) issued a clarification on implementation of the Junk Fax Prevention Act of 2005. Its summary is provided below:

^. Facsimile numbers compiled by third parties on behalf of the facsimile sender will be presumed to have been made voluntarily available for public distribution so long as they are obtained from the intended recipient’s own directory, advertisement, or Internet site;
^. Reasonable steps to verify that a recipient has agreed to make available a facsimile number for public distribution may include methods other than direct contact with the recipient; and
^. A description of the facsimile sender’s opt-out mechanism on the first Web page to which recipients are directed in the opt-out notice satisfies the requirement that such a description appear on the first page of the Web site.

This law requires the following:

^. the notice of intention provided as part
of an application for a public report by a subdivider must contain a specified notice if the property is located within one mile of farm or ranch land; and
^. An expert ("licensed engineer, land surveyor, geologist, or expert in natural hazard discovery"), when responding to a request for a natural hazards disclosure statement, must determine whether the residential property is located within one mile of farm or ranch land and to provide a specified notice to that effect.

Amended Business and Professions Code Section 11010 and Civil Code Section 1103.4.

A person who owns, leases, controls, operates, or maintains an occupied dwelling or occupied structure in, upon, or adjoining a mountainous area, forest-covered lands, brush-covered lands, grass-covered lands, or land that is covered with flammable material, that is within a very high fire hazard severity zone or in a state responsibility area must significantly reduce the risk of ignition of the habitable structure by maintaining defensible space no greater than 100 feet from each side of the structure, but not beyond the property line unless allowed by state law, local ordinance, or regulation.

A greater distance than that may be required by state law, local ordinance, rule, regulation, or by an insurance company under certain circumstances. Clearance beyond the property line may only be required if the state law, local ordinance, rule, or regulation includes findings that such a clearing is necessary.

Amended Government Code Sections 51175, 51177, 51178, 51182.

S. 3406
Amendments to the ADA
(eff. 1/1/09)

The Americans with Disabilities Amendments Act of 2008 (ADAAA) expands the definition of a covered disability, and will likely subject employers to more requests for accommodation and more claims of discrimination on the basis of disability. It overturns a series of Supreme Court opinions interpreting the ADA, including Sutton v. United Air Lines, Inc., and Toyota Motor Manufacturing, Kentucky, Inc. v. Williams.

Among other things, the ADAAA expands the definition of “major life activities” through a non-exhaustive defining list of major life activities, which contains both "general" categories such as caring for oneself, eating, sleeping, walking, lifting, thinking, communicating and working, and “major bodily functions” such as functions of the immune system, normal cell growth, digestive, neurological, respiratory, circulatory and reproductive functions. The inclusion of these definitions, in conjunction with the pronouncement that “an impairment that substantially limits one major life activity need not limit other major life activities in order to be considered a disability” expands the scope of the protection previously afforded under the ADA.

Proposition 99
Restriction on Eminent Domain in reaction to Kelo v. City of New London
(passed 6/3/08)

Under previous law, state and local governmental agencies had the ability to acquire private property by eminent domain. The U.S. Supreme Court had upheld the right to governmental agencies to take private property by eminent domain, and then turn over that property to another private person (e.g., for a development project) in Kelo v. City of New London. Proposition 90 was an attempt to reform that right of eminent domain in California, but Proposition 90 was defeated in a ballot measure in 2006.

Under the new law, state and local government agencies cannot take owner-occupied residences by eminent domain to transfer to a private person except for certain very limited exceptions. These limited exceptions are for:

^. protecting public health and safety;
^. preventing serious, repeated criminal activity;
^. responding to an emergency; or
^. remedying environmental contamination which poses a threat to public health and safety.

For purposes of this law, owner-occupied residence must be the primary residence for one year prior to the state or local governmental agency’s initial written offer to purchase the property.

Amended Article 1, § 19 of the California Constitution.

The foreclosing lender must now give the tenant a 60-day notice instead of the previous 30-day notice. [Note,however, for Section 8 tenants the notice period is not changed and remains 90 days.] Furthermore, the 60-day notice period does not apply to the owner--or any party to the note--who is occupying the foreclosed property. The owner or party to the note need be given only a 3-day notice to quit.

Tenant/owner-occupant must also get a statutory notice of the foreclosure (in 6 different languages) once a notice of sale has been posted on a property. This foreclosure notice must be posted along with the notice of sale and also mailed to the tenant/owner-occupant. This provision takes effect 60 days after the measure becomes law. (eff. 9/9/08) For a copy of the notice, click here.

A lender cannot file an NOD until 30 days after contact is made with the borrower to "assess the borrower's financial situation and explore options for the borrower to avoid foreclosure" or 30 days after satisfying due diligence requirements to contact the borrower. The lender must advise the borrower of the right to request a subseqent meeting within 14 days, and to provide the borrower the toll-free phone number of a HUD-certified housing counseling agency.

A foreclosing lender or purchaser at a trustee's sale (or foreclosure sale) must "maintain" the condition (defined in the statute) of the property or be subject to a fine of up to $1,000 per day per violation.

Added Code of Civil Procedure section 1161b, Civil Code sections 2923.5, 2923.6, 2923.8, and 2929.3.

This law amends the existing mortgage foreclosure consultants law. It contains the following provisions:
^. Cancellation Right: Permits an owner to cancel a foreclosure consultant contract until midnight of the fifth business day (previously third business day) by mail, e-mail, or facsimile.
^. Foreign Language Rule: Requires the contract to be written in the same language as principally used by the foreclosure consultant to describe his or her services or to negotiate the contract and requires the foreclosure consultant to provide the owner, before the owner signs the contract, with a copy of a completed contract written in any other language requested by the owner. If English is the language principally used by the foreclosure consultant to describe his/her services or to negotiate the contract, the foreclosure consultant must notify the owner orally and in writing before the owner signs the contract that the owner has the right to ask for a completed copy of the contract in a language described in Civil Code Section 1632(b) (i.e., prior to the execution, a translation of the contract or agreement in the language in which the contract or agreement was negotiated, which includes a translation of every term and condition in that contract or agreement.) (Non-English languages specified in Civil Code Section 1632: Spanish, Chinese, Tagalog, Vietnamese, or Korean.)
^. Power of Attorney Prohibition: Prohibits a foreclosure consultant from taking any power of attorney from an owner for any purpose.
^. Registration Requirement: Requires a foreclosure consultant to register with the Department of Justice (DOJ).
^. Bond Requirement: Requires a foreclosure consultant to obtain and maintain a surety bond of $100,000. The DOJ may refuse to issue, or may revoke a certificate of registration because of any misstatement in the registration form, because the foreclosure consultant has failed to maintain the bond required and because of any violation of the foreclosure consultant law. There are penalty provisions.
^. New Fund: Creates a Foreclosure Consultant Regulation Fund in the State Treasury.

Amended Civil Code Sections 1632, 2945.2, 2945.3, and 2945.4 and added Section 2945.45.

Any governing document of a homeowners association that effectively prohibits or restricts the installation or use of a solar energy system is void and unenforceable. Reasonable restrictions are permissible.

Amended Civil Code Section 714.

This law permits an association, with respect to separate interests governed by the association, to record a request that a mortgagee, trustee, or other person authorized to record a notice of default regarding any of these separate interests, mail to the association a copy of any trustee's deed after the trustee's sale concerning a separate interest.

The request must include a legal description or the assessor's parcel number of the separate interest as well as the name and address of the association and a statement that it is a homeowners' association. Subsequent requests of an association will supersede prior requests. A request must be recorded before the filing of a notice of default.

It requires the mortgagee or trustee to mail that information to the association within 15 business days following the date the trustee's deed is recorded. It specifies that failure to mail the information will not affect the title to real property.

Amended Civil Code Section 2924b.

Existing law requires an association to distribute a specified written notice to each member of the association during the 60-day period immediately preceding the beginning of the association's fiscal year. This notice must include information about assessments, foreclosure, payments, meetings, and payment plans.

This law requires the written notice to also include a statement notifying members that an owner may, but is not obligated to, pay under protest any disputed charge or sum
owed to the association and by doing so specifically reserve the right to contest the disputed charge or sum in court or otherwise.

This bill provides that if a dispute exists between the owner of a separate interest and the association regarding any charge or sum owed to the association and the amount does not exceed the jurisdictional limits for small claims court, the owner may, in addition to pursuing dispute resolution, pay under protest the disputed amount and all other amounts levied, including any fees and reasonable costs of collection, reasonable attorney's fees, late charges, and interest, if any, and commence an action in small claims court.

Nothing in the section added by this law impedes an association's ability to collect delinquent assessments, as specified.

Amended Civil Code Section 1365.1 and added Section 1367.6.

H.R. 3221
Housing and Economic Recovery Act/ HOPE for Homeowners Program
(eff. 7/30/08)

12 C.F.R. Part 226
Final Rule Under Reg Z

(eff. 10/1/09)

This Regulation Z final rule establishes a new category of "higher-priced mortgages" that includes virtually all closed-end subprime loans secured by a consumer's principal dwelling. Which loans qualify as "higher-priced" will be determined by a new index that will be published by the Federal Reserve Board. The rule's definition of "higher-priced mortgage loans" will capture virtually all loans in the subprime market, but generally exclude loans in the prime market.

The rule for these higher-priced loans:

^. Prohibits a lender from making a loan without regard to borrowers' ability to repay the loan from income and assets other than the home's value. A lender complies, in part, by assessing repayment ability based on the highest scheduled payment in the first seven years of the loan. To show that a lender violated this prohibition, a borrower does not need to demonstrate that it is part of a "pattern or practice."
^. Prohibits a lender from relying on income or assets that it does not verify to determine repayment ability.
^. Bans any prepayment penalty if the payment can change during the initial four years. For other higher-priced loans, a prepayment penalty period cannot last for more than two years.
^. Requires that the lender establish an escrow account for the payment of property taxes and homeowners' insurance for first-lien loans. The lender may offer the borrower the opportunity to cancel the escrow account after one year.

The rule for all closed-end mortgages secured by a consumer's principal dwelling:

^. Prohibits certain servicing practices: failing to credit a payment to a consumer’s account as of the date the payment is received, failing to provide a payoff statement within a reasonable period of time, and "pyramiding" late fees.
^. Prohibits a creditor or broker from coercing or encouraging an appraiser to misrepresent the value of a home.
^. Creditors must provide a good faith estimate of the loan costs, including a schedule of payments, within three days after a consumer applies for any mortgage loan secured by a consumer's principal dwelling, such as a home improvement loan or a loan to refinance an existing loan.

The rule for all mortgages:

Requires advertising to contain additional information about rates, monthly payments, and other loan features. The rule also bans seven deceptive or misleading advertising practices, including representing that a rate or payment is "fixed" when it can change.

Compliance with the new rules, other than the escrow requirement, is mandatory for all applications received on or after October 1, 2009. The escrow requirement has an effective date of April 1, 2010 for site-built homes, and October 1, 2010 for manufactured homes.

This federal law provides authority for the Federal Government to purchase and insure certain types of troubled assets for the purposes of providing stability to and preventing disruption in the economy and financial system and protecting taxpayers, to amend the Internal Revenue Code of 1986 to provide incentives for energy production and conservation, to extend certain expiring provisions, to provide individual income tax relief, and for other purposes.

This law, commonly known at the $700 Billion Bailout, strengthens the FHA-insured refinance of loans for troubled mortgages under the HOPE for Homeowners program. It also extends the tax exemption for mortgage debt forgiveness on home loans under the Mortgage Forgiveness Debt Relief Act of 2007 until December 31, 2012.

Cal HFA is the state's independent affordable housing bank. Cal HFA's programs are entirely self-supporting and unlike general obligation bond programs do not rely on any tax-payer or state-funded support. CalHFA sells bonds and uses the proceeds of the bonds to make home loans and apartment construction loans.

SB 870 permits the California Housing Finance Agency (Cal HFA.) to establish rules and regulations for a mortgage refinance program which was authorized by the federal law, HERA.

The federal Housing and Economic Recovery Act of 2008 (HERA) included a one-time increase in the national allocation of tax-exempt bond capacity of an additional $11 billion. California's portion is approximately $1.175 billion. The additional tax-exempt bond capacity can be used for three purposes: refinancing sub-prime mortgages, providing below market rate mortgages to first-time homebuyers, and construction of multi-family rental properties. (Note: This is the first time federal law has permitted the use of tax-exempt bonds for refinancing mortgages.)

Amended Health and Safety Code Sections 50086, 51050, and 51101 and added Section 51058.5.

This law permits cities and counties to use revenue bond funds to make or purchase refinanced home mortgages that are federally insured, federally guar