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States Tackle Foreclosures In Absence of Federal Help
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Maryland has extended the timetable for foreclosure from 15 days to 150. Massachusetts has arranged temporary reprieves for more than 600 homeowners over the past year. Philadelphia is setting up a program that allows borrowers to get financial and legal counseling before auctions of their property are scheduled. The Ohio Supreme Court approved a mediation program in January.
Under the Ohio initiative, lenders who want to foreclose must first try to work out payments with homeowners. Only then will courts turn over the documents that companies need to sell the homes.
"That gives us leverage," said Richard Cordray, Ohio's treasurer. "To get what they need from our courts, they have to sit down and go through a mediation process as in all other civil cases. It slows down the process and gets everyone to the table."
In Ohio, manufacturing job losses have exacerbated the state's mortgage woes. Last year, more than 80,000 foreclosure cases were filed in Ohio courts, a 40 percent rise from four years ago. But that has not discouraged the state's relatively new leaders.
"I'm not at all pessimistic that we'll make a real dent in this problem," said Cordray, who took office a year ago. "It's just that we've got many bad loans to work through."
Staff researcher Richard Drezen contributed to this report.
