Attorney General Martha Coakley is again focusing attention on the foreclosure crisis in the state of Massachusetts and the resources recently made available to struggling homeowners. Since 2007, more than 45,000 homeowners have lost their homes to foreclosure and because of that a number of initiatives have been put in place to stymie the pace of foreclosures in the state and provide homeowners with more options for mortgage loan modifications. As we have reported previously on our blog, the HomeCorps program is available to mortgage borrowers to assist them with legal questions regarding loan modifications and initiatives in an effort to prevent unnecessary home foreclosures.
The HomeCorps program was and is funded by the state's share of the settlement received from five of the country's largest mortgage lenders and servicers. The settlement was in connection with their involvement in unlawful foreclosures and loan servicing procedures. And also previously reported, a new law has gone into effect that essentially requires loan servicing companies to modify a mortgage loan when it is commercially viable to do so. What this means is a mortgage lender must look at the financial circumstances of the borrower and determine whether a foreclosure or a modification of the loan is more economically viable for the lender.
In other words, if the net value of modifying the loan will bring better recovery to the lender than foreclosing on the home, the lender is required, by law to modify that loan rather than proceed with a foreclosure. The Attorney General states this initiative is the first-of-its kind and in Brockton just last week discussed the impact it will have on homeowners. She was joined by the U.S. Secretary of Housing and Urban Development, Shaun Donovan. In her discussion points, Ms. Coakley said almost 2,800 cases involving homeowners seeking assistant with their mortgage loans are currently open and 1,300 of those homeowners are actively mediating their cases.
Almost 2,300 of these cases involve one or more of the banks involved in the national settlement. The initiatives set forth by the AG's office have thus far resulted in almost 500 mortgage loan adjustments since the program began last April. But more homeowners still are still in need of help, she said. The mortgage crisis is largely blamed for starting the worst recession in several decades and will not simply go away overnight, said Ms. Coakley. If you need help with a mortgage or foreclosure problem, consider consulting with a professional who handles a wide range of residential real estate issues, including refinancing and loan modification assistance.
Source: Bloomberg BusinessWeek, "Mass. AG to discuss foreclosure prevention program," Aug. 27, 2012
Our Worcester firm handles a wide range of residential real estate issues, including mortgage and foreclosure assistance and real estate transactions. Visit our residential real estate page to learn more.