As Foreclosure Crisis Worsens, State May Offer More Forums to Help Homeowners
December 18, 2007
Cross posted from the Michigan Messenger
Michigan is studying whether to hold more sessions to help homeowners who fear foreclosure, after thousands of people came to Detroit’s Cobo Center last week for a forum to learn how to save their homes.
The forum was hosted by state Attorney General Mike Cox and the banks and lenders present represented 98 percent of the Michigan mortgage market. Participants were able to interact directly with their lenders, talk to independent loan counselors and the Federal National Mortgage Association, and attend 45-minute classes on topics like options to avoid foreclosure, dealing with property taxes and what to do when you are in foreclosure.
Matt Frendewey, spokesperson for the attorney general, said: “We are going to evaluate and see if we are going to hold more events like this around the state.”
A resident from Warren who did not want her name revealed said the interest rate on her adjustable rate mortgage (ARM) had increased 5 percent since last January. Asked what type of help was offered at the forum, she said her lender “told me to bring in my paperwork on Monday and they said they might be able to bring me back down to the rate they had me at before my rate went up.”
The foreclosure crisis is impacting homeowners across the nation. According to reports, an estimated two million ARMs are due to reset at higher amounts during the next eight months. The problem is especially acute in Michigan with 17,162 foreclosure filings in October — sixth highest in the nation — according to the latest figures from RealtyTrac, an Irvine, Calif.-based online clearinghouse for foreclosure information.
A Detroit resident who did not want his name revealed told Michigan Messenger: “I was OK in bankruptcy but because my employer didn’t get the money that they took from me to the trustee in a timely manner, the trustee kicked me out. I told the trustee that it wasn’t my fault my job didn’t make the payments, (but) the trustee didn’t want to hear it. They kicked me out. Everything went down from there. I have two more months to either come up with the money, or get out.”
Frendewey told Michigan Messenger: “If we don’t do anything and we pretend there is nothing we can do, the problem is only going to get worse. So the attorney general asked what the biggest problem was when talking to some of these banks and lenders and they said, `We don’t want to own the homes, we want to sit down with folks and try to provide solutions.’ “
Cox said his office invited more than 30,000 residents to the forum “who have been identified as persons with whom the lender would like to discuss possible remedies to help the borrowers stay out of foreclosure.”
Linda Watts from Detroit has a house already in foreclosure. “I couldn’t get a refinance because of my income and I couldn’t get a fixed rate so my mortgage went up to $1,100, which I couldn’t afford to pay because I am on a fixed income and I barely get that a month,” she said.
After talking to her lender, Watts was frustrated at the timing of the forum: “They should have had this event a long time ago instead of waiting until all these people are losing their homes. My lender told me to just go ahead and move and I just hope I don’t have to go into a shelter.”
According to Frendewey, there was some good news: “A woman came out with tears in her eyes because she finally saved her home. She wrote on the evaluation, ‘Give this to whoever set this up,’ and that makes us feel good.”
For those seeking help regarding foreclosure, contact the Attorney General’s Office at 517-373-1110 or toll-free at 877-765-8388.
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