DELAURO FIGHTS TO PROTECT STRUGGLING HOMEOWNERS
New Haven, CT— Congresswoman Rosa DeLauro (CT-3) held a press conference today to call for the passage of the Regulation of Mortgage Servicing Act, legislation she introduced that would establish national standards for mortgage lenders and help to protect families struggling to avoid home foreclosure.
The Regulation of Mortgage Servicing Act will prevent foreclosures by ensuring that eligible borrowers have access to loan modifications and other alternatives to foreclosure. Too many families have fallen behind on their mortgages and suddenly found themselves facing foreclosure, even as they work with their lenders to modify their mortgage, or unable to reach someone at their lender who can provide them with the information they need. Once the foreclosure process begins, there are very few options to resolve it that allow families to keep their homes.
The Regulation of Mortgage Servicing Act will change this by mandating a single point of contact for lenders to work with homeowners, establishing national standards for lenders and prevent dual tracking of foreclosures and loan modifications by requiring mortgage servicers to review eligible homeowners for loan modifications and other alternatives to foreclosure. Additionally, it would require a third-party review of loan modifications and foreclosure alternatives before sending a family into foreclosure. In the wake of the robo-signing scandal that contributed to the housing market collapse, in which millions of mortgage documents were approved by banks without the required reviews, this third-party review is critical to ensuring homeowners have every opportunity to keep their homes.
With 1 in every 10 families in the Milford/ New Haven area in foreclosure or more than 90 days delinquent on their mortgages, this is a critically important issue.
"For many families, the dream of owning a home has become a nightmare. We need to make sure mortgage servicers play by the rules and are working first and foremost to help families. That is why I have introduced the Regulation of Mortgage Servicing Act, which establishes clear national standards for mortgage servicers to improve interactions between them and struggling homeowners, as well as requiring a third-party review of all foreclosure proceedings to ensure that families have every opportunity to keep their homes," said Congresswoman DeLauro. "It is time to make our system work for American consumers again. We need accountability for the past crimes, and new rules to clean up the system moving forward. This bill will get it done."
"Reforming national servicing standards, as this legislation proposes, is also a critical part of the proposed multi-state foreclosure settlement now being negotiated by the state attorneys general. Banks must do a better job helping customers facing economic difficulties," said Connecticut Attorney General George Jepsen. "Extending servicing reforms across the industry -- and giving critical parts the force of law --ensures that fewer people will lose their homes to foreclosure," he said.
Jeff Gentes, the Managing Attorney for Foreclosure Prevention at the Connecticut Fair Housing Center, says "Homeowners tell us every day how difficult it is to contact their mortgage company, and we spend much of our time helping homeowners who've been wrongly denied mortgage workouts. Requiring servicers to assign a case worker to homeowners' files, and ensuring servicers take the time to review a file properly before starting a foreclosure would help thousands of Connecticut homeowners. We strongly support this bill, and thank Congresswoman DeLauro for her efforts to end the foreclosure crisis and get our economy moving again."
Congresswoman DeLauro was joined by Connecticut Attorney General George Jepsen, Gary Johnson, President and CEO of the United Way of Milford, CT, Jeff Gentes of the Connecticut Fair Housing Center, Sandy Shede, former Legislative Chair of the Connecticut Realtors Association, and local homeowners who would benefit from this legislation.