Mortgage foreclosure consultants: loan audits.

Existing law defines a foreclosure consultant as any person who makes any solicitation, representation, or offer to any homeowner to perform for compensation or who, for compensation, performs specified services relating to foreclosure sales, including performing debt, budget, or financial counseling of any type and giving any advice, explanation, or instruction to an owner of a residence in foreclosure which in any manner relates to the cure of a default in or reinstatement of an obligation secured by a lien on the residence. Existing law requires a person to register with, and obtain a certificate from, the Department of Justice to provide foreclosure consultant services. Existing law establishes various prohibited acts applicable to foreclosure consultants, including prohibiting a foreclosure consultant from claiming, demanding, charging, collecting, or receiving any compensation before fully performing the services which the foreclosure consultant was contracted to perform. Existing law makes it a crime to perform foreclosure consultant services without being registered with the department or to violate the prohibited acts applicable to foreclosure consultants. This bill would provide that foreclosure consultant services include arranging or attempting to arrange the audit of any obligation secured by a lien on a residence in foreclosure and thereby would require a foreclosure consultant to register with the department to arrange or attempt to arrange those audits. By expanding the scope of persons subject to provisions of law applicable to foreclosure consultants, a violation of which is a crime, this bill would impose a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason.