"I'm pleased that the governor recognizes that banks and mortgage brokers are not capable of regulating themselves," he said. "California has the responsibility and the obligation of raising the standards."
Making the governor's plan work will depend on the administration giving regulators the tools needed to ensure that brokers don't take advantage of borrowers, said Kevin Stein, associate director of the California Reinvestment Coalition, a San Francisco-based group that advocates for consumers and low-income communities.
"There has to be real monitoring and enforcement," he said.
Leaders of the state Senate agreed that Sacramento needed to do more to help strapped homeowners. But they questioned whether the upcoming special session was the right time for action.
The Legislature's immediate focus needs to be on the quest to find new revenues and ways to cut spending to fill an estimated $11.2-billion hole in the current state budget. Schwarzenegger "may have cast this too broadly," Senate President Pro Tem Don Perata (D-Oakland) said.
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marc.lifsher@latimes.com
