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The proposal was modeled on a Nevada system that supporters said has helped keep people in their homes. Critics said the system would be unworkable in a place as large as California. All Republicans, along with some Democrats, opposed the bill or abstained.
Another bill would change state law to make it easier for borrowers to take loan companies to court if the companies failed to communicate with them or explain a refusal to modify a mortgage, among other rules.
Supporters say SB 1275 would encourage lenders to make more of an effort to work with borrowers before beginning the foreclosure process.
Currently, backers say, many borrowers get the runaround from loan-service companies that lose paperwork or don’t return phone calls. Then they get foreclosed upon.
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