Senate committee moves homeowner security legislation

OLYMPIA – Buying a home in today’s market can be a scary endeavor. Though Washington has been spared the worst of the nationwide mortgage crisis, there is fear that many homeowners could still get hit within the next year.

Gov. Christine Gregoire formed the Task Force for Homeowner Security last fall to evaluate instability in the national subprime mortgage market and determine how best to minimize the impact in Washington. The task force found that due to a relatively healthy economy, stable home prices and a low number of subprime loans with adjustable rate mortgages, Washington has not had as many foreclosures as other states. In December the task force issued recommendations on responsible mortgage lending, financial literacy, and improved protections for homebuyers.

Sen. Jean Berkey, D-Everett, introduced Senate Bill 6272, which addresses consumer education and financial literacy. Under this legislation, the Department of Financial Institutions, DFI, will disseminate information to consumers about the laws regulating financial institutions and assist homebuyers in obtaining information about financial products. The Senate passed SB 6272 on Jan. 18.

“Knowing which type of lender to choose, as well as dealing with the numerous documents required which have terms and conditions that may be over-looked, can make buying a home very stressful,” said Berkey. “This legislation helps homebuyers choose the right lender for them and understand their financial commitment.”

Berkey is also the prime sponsor of Senate Bill 6728, which incorporates the remaining task force recommendations by providing for clearer language in foreclosure notices, full financial disclosure from lenders and protection against foreclosure scams.

SB 6728 passed out of the Senate Financial Institutions & Insurance Committee on Tuesday, Jan. 29, and has been referred to the Senate Rules Committee.

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