CLTA-Sponsored Legislation Extending HELOC Reform Signed into Law
Monday, July 9, 2018
A CLTA News Express
July 9, 2018
Senate Bill 1139 (Morrell), a CLTA-sponsored measure that indefinitely extends home equity line of credit (HELOC) reforms that standardize the written notification process for the easy closing of HELOCs during escrow, was signed into law by Governor Brown earlier today. The reforms combat fraud and unintended misuse by prohibiting an original borrower, who no longer owns a home, from drawing on, increasing, or incurring any new additional principal debt on the equity line of credit.
Before being signed by the Governor, SB 1139 was passed unanimously by the legislature without a single vote in opposition. CLTA sponsored the original bill enacting the reforms, AB 1770 (Dababneh), in 2014. Prior to the enactment of SB 1139, the provisions enacted by AB 1770 were set to expire July 1, 2019.