Mdhousing's Blog

JANUARY 26

Annapolis, MD – Maryland can prepare for a possible upsurge in new foreclosures by adopting reforms that get foreclosed and vacant properties back on the tax roles as quickly as possible, Secretary Skinner said during testimony before state legislators Thursday.

Testifying before the Senate Judicial Proceedings Committee on the findings of the Maryland Foreclosure Task Force, Secretary Skinner and Department of Labor, Licensing and Regulation Secretary Alexander Sanchez warned that the nature of the crisis may have changed but it is still with us. Read the task force report.

“While the data shows a significant decrease, we think foreclosures are going to be a problem for some time to come – at least until the national housing market recovers,” Secretary Skinner said.

Committee members said many of their constituents were still finding it hard to work with lenders and were still being told that housing counselors cannot help them save their homes. The Judicial Proceedings Committee is chaired by State Sen. Brian Frosh, of Montgomery County and co-chaired by State Sen. Lisa Gladden, of Baltimore.

Secretary Skinner pledged that DHCD’s successful Mortgage Late? Don’t Wait! foreclosure prevention forums, would continue to be held throughout the state. Those forums bring homeowners, counselors, pro bono attorneys and lenders together for face-to-face sessions aimed at finding sustainable alternatives to foreclosure that all parties can agree to. See a schedule of upcoming events. DHCD has participated in more than 539 such events since the crisis first hit, reaching more than 107,000 people.

JANUARY 20

Maryland foreclosures last year hit the lowest level since the collapse of the national housing market in 2007, according to year-end data from RealtyTrac, and the state ‘s foreclosure rate now ranks in the bottom tier in the country. See the fourth quarter report.

There were 14,421 foreclosure events in Maryland last year, the California-based real estate monitoring firm reported. That’s compared to 42,446 events in 2010; 43,248 events in 2009; 32,338 events in 2008; and 18,879 events in 2007. In 2006, the last full year before the crisis struck, Maryland had 3,094 events. “Events” include notices of default, foreclosure sales and lender purchases, but individual households are not counted more than once in the data.

A significant factor in the fall in foreclosures has been the reforms enacted in Maryland under the leadership of Governor Martin O’Malley and Lt. Governor Anthony Brown. Before those reforms, foreclosures sped through the courts, sometimes taking as little as 15 days. Families found they had lost their home before they fully realized what was going on.

Today, the process takes an average of 634 days, one of the longest in the nation. New York ranks first with an average 1,019 days. The extra time gives financially beleaguered homeowners additional time to consult with foreclosure prevention counselor and attorneys to learn more about their options. Some analysts warn however that there may be a future upsurge as pent-up foreclosures work their way through the system.

On Jan. 12, the Maryland Foreclosure Task Force issued its final report recommending additional reforms, including tax incentives and the creation of a statewide registry that would help move foreclosed and vacant properties back onto the market quicker. The panel also urged lenders to adopt industry best practices, including greater use of loan modifications.

Visit DHCD’s MDHOPE website to learn more about the resources available to homeowners through programs such as foreclosure mediation and the HOPE Counseling Network. Since 2007, the network has helped more than 70,000 homeowners, achieving positive results in 92 percent of the cases completed.

JANUARY 19

In response to the ever-evolving nature of Maryland’s foreclosure crisis, a task force is recommending a mixture of new legislation and industry best practices to help financially beleaguered homeowners either preserve their homes until they get back on their feet or find a ‘dignified exit.’ Read the full report.

The Maryland Foreclosure Task Force released its final report on Jan. 12. Governor O’Malley has convened three panels since 2007, as the crisis moved from homeowners trapped in predatory subprime loans to homeowners caught in the prolonged economic downturn.

The panel called for new legislation that would introduce the option of foreclosure mediation earlier in the process; create a centralized foreclosed property registry and create a tax credit for people who buy a foreclosed property as their principal residence.

Recommended industry best practices included the use of extended forbearance allowing homeowners in financial distress to make monthly payments based on 31 percent of their income until they get back on their feet; and increased use of loan modification and refinance options. The task force also recommended increased use of structured liquidation options that would soften the impact on borrowers who are forced to relinquish their homes.

The task force was chaired by Secretary Skinner and Alexander Sanchez, secretary of the Department of Labor, Licensing and Regulation. Its members included legislators, the judiciary, consumer advocates and representatives of the banking industry.