Foreclosure Resolution Blog

Congressman Barney Frank and Representative Maxine Waters sent a letter to President Bush, urging him to place FDIC Chair Sheila Bair in charge of foreclosure prevention on mortgages acquired through the recently passed $700 billion legislation. You know, the one where the federal government was going to buy distressed mortgages? Never mind that they’ve already spent half of the money injecting capital into banks and NOT buying mortgages.

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In some ways, the interests of the mortgage insurance companies are more closely tied to homeowners who are trying to prevent foreclosure than anyone else involved in the foreclosure process. Housing Wire recently reported that Genworth Financial is expanding its pre-purchase education efforts to inform borrowers about their options if they fall behind on payments and need to prevent foreclosure.

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One of the key selling points of the Foreclosure Prevention Act was that it was projected to prevent foreclosure for “at least” 400,000 homeowners. I’ve noted that there are more questions than answers about this legislation delivering on its promise of foreclosure prevention.

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Chapter 13 bankruptcy is often sold to homeowners as a “wonder drug” method to prevent foreclosure when they’re behind on payments. In our pop-a-pill culture, it seems that our first reaction is often to reach for anything that promises immediate relief.

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Just when you thought that Congress was the only legislative body screwing things up, there’s news that New Jersey legislators are moving forward on a new bill to “encourage” lenders to avoid foreclosure. The New Jersey Home Ownership Preservation Act would tax lenders $2,000 for every foreclosure.

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Suze Orman and Ali Velshi (CNN financial reporter) appeared on Oprah this week to explain what caused the foreclosure crisis, and how individuals can best respond to the financial meltdown. While I agree with Ms. Orman’s suggestions (if not the order of those suggestions), her explanation of the cause of the foreclosure crisis was overly simplistic and conveniently omitted ….

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Just when you thought the mortgage industry couldn’t get any more screwed up, it looks like having good credit actually makes it more difficult to stop foreclosure these days. According to just-released stats from HOPE NOW, only 26.9% of all prime workouts are loan modifications.

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In July, I posed the question, “Will Mortgage Companies Take Advantage of the Foreclosure Bill?” With several logistical obstacles just off the top of my head, I predicted that there was no way that lenders were going to be able to handle Foreclosure Prevention Act mandates.

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