The California Assembly is considering AB 1588, which would implement the Monitored Mortgage Workout (MMW) Program. MMW would provide for state-appointed monitors to guarantee homeowners a chance at working out a plan with their lender to avoid foreclosure. The bill was introduced recently by Karen Bass, the California assembly speaker, and announced by Antonio Villaraigosa, the mayor of Los Angeles. Any borrower who receives a notice of default (NOD) would be eligible to participate in the MMW Program, which would be administered by the California Housing Finance Authority (CHFA). But the borrower would have to notify the CHFA his or her intention to participate in the program within 30 days of the NOD. Once the borrower participates in the program, a state monitor oversees the loan modification process and no further steps can be taken toward foreclosure until the MMW program has been completed. According to an announcement from Bass, the state monitor would assist in assessing the affordability of any loan modification and would analyze the net present value effect on the lender. If a modification isn’t reached, the monitor would form a proposal that fits the guidelines of the Home Affordable Modification Program (HAMP). Through HAMP, the US Treasury Department allocates capped incentives for the modifications of loans on the verge of foreclosure. If the lender rejects the proposal or if the monitor determines that the lender acted in bad faith during the negotiations, the borrower can try to enforce the monitor’s proposed HAMP modification in an expedited court action. “Finding alternatives to foreclosure that homeowners and banks can agree to will keep our neighborhoods intact and help turn California’s economy around,” Bass said. At the end of October, the bill reached an Assembly committee. Write to Jon Prior.