Effort to protect homeowners suffers setback


She thought she got good news last summer. "Essentially, I received a forbearance agreement on one day, the 27 of June. On the following day, the home was foreclosed on," she said.

Kenney was a victim of dual tracking, where banks go through a loan modification with you but at the same time continue the foreclosure process in case the modification doesn't work out.

That's just one practice that Attorney General Kamala Harris is trying to quash in her Homeowners Bill of Rights package, a series of proposals aimed at giving consumers greater protection.

But at the last second, the Assembly Banking Committee pulled two bills scheduled for a hearing, usually an indication there aren't enough votes.

Harris vows to keep pushing. "It's not about bailing people out. It's not about giving them a handout. It's simply saying let's have clear rules so that if you want to follow the rules, you can actually succeed," she said.

The California Bankers Association supports some of Harris's proposals but opposes the ban on dual tracking, saying it only delays the inevitable.

Beth Mills of the California Bankers Association said: "We're concerned about any legislation that protects the foreclosure process and will actually impede new opportunities for new homebuyers and also California's housing and economic recovery, which impacts all of us."

Foreclosure victims are disappointed but not surprised, given the power of who they're dealing with. Kenney said, "We're going to keep showing up, and we're going to keep making our stories and our faces known."

While the official reason for pulling the bills is to rethink strategy, banks and other financial institutions spent nearly $70 million in California on lobbying fees and political contributions between 2007 and 2010.

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