Frustration over the state’s continually high number of foreclosures is causing concern among California foreclosure lawyers and lawmakers too. California House Democrats last week criticized the Obama administration for not doing enough to resolve the foreclosure crisis.

The Democratic delegation has sent a letter to the president, asking him to take measures that housing groups have been pushing for ever since the financial crisis began. These measures include refinancing all mortgages owned or guaranteed by Fannie Mae and Freddie Mac, and allowing principal write-downs of certain mortgages through bankruptcy protection in order to avoid foreclosures. The measures also include establishing a Homeowners’ Bill of Rights that would require the review of documents in a timely manner and include other changes that benefit homeowners.

Much of this criticism of the administration’s handling of the foreclosure crisis has to do with the fact that next year is an election year, and many of California's lawmakers are bound to face disgruntled voters. Some lawmakers, like those in the Central Valley district, may find this to be an especially difficult election, because these areas have been hit especially hard by foreclosures.


While the Obama administration has called on regulators who are currently overseeing Fannie Mae and Freddie Mac to allow more refinancing, it has rejected mandatory refinancing of all mortgages. Measures like this would add to the federal administration's already huge bailout bill.

The federal administration has responded to California lawmakers’ concerns by assuring them that the president is already taking measures to help struggling homeowners, especially those in states like California with a massive foreclosure crisis. The Hardest Hit Fund will be diverging funds to states that have the most foreclosures, including $2 billion to California.