California Senate Bill SB447 Amended / Bill

 BILL NUMBER: SB 447AMENDED BILL TEXT AMENDED IN SENATE JANUARY 4, 2012 AMENDED IN SENATE APRIL 28, 2011 AMENDED IN SENATE APRIL 25, 2011 AMENDED IN SENATE APRIL 14, 2011 AMENDED IN SENATE MARCH 29, 2011 INTRODUCED BY Senator DeSaulnier FEBRUARY 16, 2011 An act to add  Division 21 (commencing with Section 52000) to the Financial Code   Section 50964 to the Health and Safety Code  , relating to  financial institutions   housing  . LEGISLATIVE COUNSEL'S DIGEST SB 447, as amended, DeSaulnier.  Financial institutions: disclosures.   Housing: California Housing Finance Agency.   Existing law establishes the California Housing Finance Agency, administered by a board of directors, whose primary purpose is to meet the housing needs of persons and families of low- or moderate-income. Existing law authorizes the agency to issue revenue bonds and make construction and mortgage loans to meet the multifamily rental housing needs of persons and families of low- or moderate- income persons and families.   This bill would prohibit the agency from foreclosing on a mortgage for a single-family residence that was financed by a revenue bond that is owned or serviced by the agency for the sole reason that the mortgagor is using the residence as a rental property, provided that certain conditions are met.   Existing law regulates the operation of various financial institutions. The California Research Bureau within the California State Library provides nonpartisan research services to the Governor, the Legislature, and other state elected officials.   This bill would require a financial institution, as defined, to provide to the California Research Bureau specified information relating to, among other things, the location of branches of the financial institution in California, the lending and investment practices of the financial institution, including community reinvestment activities, and participation of the financial institution in certain mortgage assistance programs. The bill would provide that the California Research Bureau would not be required to receive this information from financial institutions that have assets totaling less than $10 billion.  Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:  SECTION 1.   Section 50964 is added to the   Health and Safety Code   , to read:   50964. The agency shall not foreclose on a mortgage for a single-family residence that was financed by a revenue bond issued pursuant to Chapter 7 (commencing with Section 51350) that is owned or serviced by the agency for the sole reason that the mortgagor is using the residence as a rental property, provided that all of the following conditions are met: (a) The mortgagor is current in making his or her mortgage payments, and has not breached any term of the mortgage. For purposes of this subdivision, the renting out of the residence shall not constitute a breach that necessitates a foreclosure action, except as may be necessary not to exceed the 4 percent cap specified by subdivision (c). (b) The mortgagor lived in the home for at least one year after the mortgage was executed. (c) No more than 4 percent of the total proceeds of the bond issuance shall be used to finance mortgages on residences that are currently used as rental properties.   SECTION 1.   Division 21 (commencing with Section 52000) is added to the Financial Code, to read: DIVISION 21. Disclosure Requirements of National Banks. 52000. (a) Except as provided in subdivision (f), a financial institution doing business in the state shall provide to the California Research Bureau all of the following information on an annual basis: (1) Percentage of California branches of the financial institution in low- and moderate-income census tracts. (2) Percentage of California branches of the financial institution in low-income census tracts. (3) Percentage of multifamily loans in low- and moderate-income census tracts in the state. (4) Total community development lending in the state, expressed as a percentage of total banking deposits. (5) Percentage of California community development loans to nonprofit borrowers. (6) Percentage of California home purchase loans to low- and moderate-income borrowers. (7) Percentage of total deposits spent on philanthropic or charitable donations in the state. (8) Participation in CalHFA's Unemployment Mortgage Assistance Program, with regard to loans serviced by the financial institution, as expressed by the total number of borrowers participating in the state and total number of borrowers who have applied for assistance in the state and have been referred as eligible candidates by CalHFA. (9) Participation in CalHFA's Mortgage Reinstatement Assistance Program, with regard to loans serviced by the financial institution, as expressed by the total number of borrowers participating in the state and total number of borrowers who have applied for assistance in the state and have been referred as eligible candidates by CalHFA. (10) Participation in CalHFA's Principal Reduction Program, with regard to loans serviced by the financial institution, as expressed by the total number of borrowers participating in the state and total number of borrowers who have applied for assistance in the state and have been referred as eligible candidates by CalHFA. (11) Participation in the federal Home Affordable Modification Program, administered by Fannie Mae, as expressed by the total number of borrowers participating in the state and total number of borrowers who have applied for assistance in the state. (b) A financial institution reporting participation in any mortgage modification program shall provide the California Research Bureau with information on both the number of trial modifications and permanent modifications whenever applicable. (c) A financial institution reporting a percentage under this section shall also indicate the absolute value of the numerator and denominator used in calculating the percentage. (d) Reporting participation in a mortgage assistance program specified in subdivision (a) shall not be required if that program ceases to operate. (e) All data reported on lending pursuant to this section shall be reported using the book value of loans. (f) The California Research Bureau shall not be required to receive information pursuant to this section from a financial institution that has assets totaling less than ten billion dollars ($10,000,000,000). (g) For purposes of this section: (1) "CalHFA" means the California Housing Finance Agency. (2) "Community development loans" means loans made for affordable housing, including multifamily rental housing, for low- or moderate-income individuals, community services targeted to low- or moderate-income individuals, activities that promote economic development by financing businesses or farms that meet the size eligibility standards of the United States Small Business Administration's Certified Development Company or Small Business Investment Company programs (13 C.F.R. 121.301) or have gross annual revenues of one million dollars ($1,000,000) or less, and activities that revitalize or stabilize low- or moderate-income geographies or designated disaster areas. (3) "Financial institution" means a depository institution, as defined in Section 1832(b) of Title 12 of the United States Code, a commercial bank or trust company, an agency branch of a foreign bank in the United States, a credit union, a thrift institution, a broker or dealer registered with the United States Securities and Exchange Commission under the Securities Exchange Act of 1934, a broker or dealer in securities or commodities, an investment bank or investment company, or an industrial bank. (4) "Home purchase loan" means any loan secured by, and made for the purpose of purchasing, a dwelling. (5) "Low income" means an individual income that is less than 50 percent of the median income, or a family income that is less than 50 percent of the median family income, in a geographic area. (6) "Moderate income" means an individual income that is at least 80 percent of, and less than 120 percent of, the median income, or a family income that is at least 80 percent of, and less than 120 percent of, the median family income, in a geographic area. (7) "Multifamily" refers to a residential structure that contains five or more units.