The California State Assembly approved the state's first stand alone Mortgage Fraud Legislation by a 76-0 vote during week of September 11, 2009. 

This bill would establish California's first stand alone mortgage fraud law treating the crime as a felony. 

The California State Senate had earlier approved the measure, SB 239, by a vote of 39-0.

If signed into law by Governor Terminator (We hope and expect that he will sign), this legislation will make it a felony for any person to knowingly make or use any deliberate misstatement or omission during the mortgage lending process, with the intention that it be relied on by a mortgage lender, borrower, or any other party to the lending process.

Upon conviction, such California law violators could be subject to a maximum penalty of three years in state prison and a fine of up to $10,000.

California's only current dedicated mortgage fraud law makes the crime a misdemeanor.  Other states that have recently adopted dedicated felony mortgage fraud statutes with similar wording include Georgia, Arizona, Nevada, North Carolina and Florida.

This legislation (SB 239) also will help speed up investigation of mortgage fraud allegations by allowing investigators to obtain transaction related documents via court order.

The bill was created in response to explosion of mortgage fraud schemes that have contributed to major problems for our California economy. 

See - State Assembly Approves Mortgage Fraud Legislation Written by Santa Clara County District Attorney's Office.

I have read and support California SB 239, agree with good PUBLIC POLICY behind this legislation, and believe it will be signed by the Governor with little or no fanfare and disagreement.  

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Contact us if you have questions about the Orange County Real Estate Market. Thanks.  Harrison K. Long, Explore Group, Coldwell Banker Previews, Irvine, CA.