b'AB 3088 continued from page 7residential property; (2) creates a specificNoticeably absent from AB 3088the HOBROnly applies to loans originated on or procedure for handling forbearanceextension does not apply to loans made tobefore September 1, 2020;requests from qualified borrowers betweenentities or encumbering properties owned September 1, 2020 and April 1, 2021; and (3)by entities! Only applies to loans originated by limits the circumstances where tenants cancertain licensees (which covers most CMA be evicted for non-payment of rent.SinceUnfortunately, there is not enough roomlicensed members);the last section does not directly addressto delve into HOBRs many requirements REO evictions, the remainder of the articlein this article.But, the reader should nowOnly applies to borrowers who are:will focus on the HOBR and forbearancehave enough information to know if HOBR aspects of AB 3088. applies.If you have a question as to whetherA natural person who is the mortgagor HOBR applies, such as with Notices of Defaultor trustor;recorded before September 1st, or shortly Extension of HOBR after September 1stbefore you were awareA confirmed successor in interest (SII) Since 2013, HOBR has applied exclusivelyof the new statutes, please reach out to yourunder Federal LawSection 1024.31 of to first liens securing consumer loans tocounsel or the author to discuss how best toTitle 12 of the Code of Fed Regulations;individuals on owner-occupied residentialcomply with HOBR on your particular loan.properties.This limited scope has now beenA person with a power of attorney for expanded.Effective September 1, 2020,New Forbearanceeither of the above; andHOBR applies to a new category of first liensResponse Requirementssecuring loans made to individuals that meetAn entity owning a property with 1-4 the following requirements: AB 3088 created Civil Code 3273 et seq.units, provided that the property is s to address forbearance requests receivedby at least one tenant and the entity The property contains 1-4 units; September 1, 2020 through April 1, 2021.But,is NOT a:the new requirements do not apply to all The property is owned by an individualloans, borrowers or requests.Instead, there REIT(or group of individuals) who own noare a series of confusing and overlapping more than 3 residential properties, eachthresholds before the new law applies to a Corporationcontaining 4 units or less; forbearance request.Below is a list of some of those requirements: continued on page 9The property is occupied as the tenants primary residence pursuant to an Applicable Lease - one in effect on March 4, 2020, negotiated in good faith and at fair market value; andThe tenant is unable to pay rent due to a reduction in income resulting from COVID.The intention of this expansion was to cover loans made to small landlords (for acquisition or improvement of investment properties), who are actually impacted in their ability to make mortgage payments by a tenants inability to pay rent due to COVID-related income reduction.Since most of the above information to demonstrate coverage is potentially unknown, the most conservative approach is to apply HOBR to any first lien to individual borrower(s) on a 1-4 unit residential property.Later, if the servicer is able to confirm that one or more of these requirements were not met, it can take the loan out of its HOBR compliance pool.Page 8Winter 2020/2021Points of Interest'