California may expand protections for distressed borrowers

Lenders would have to consider workouts before foreclosing on most loans

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California lawmakers may expand the pool of homeowners afforded protection under an existing state law that requires lenders to contact distressed homeowners and consider them for a loan modification before beginning foreclosures proceedings.

The existing law applies only to homeowners who took out a mortgage during a five-year window, between Jan. 1, 2003 and Dec. 31, 2007.