By Henri E. Cauvin
Washington Post Staff Writer
Sunday, December 21, 2008
When Maryland's chief judge asked the state's lawyers to help homeowners facing foreclosure over the summer, hundreds of lawyers across the state stepped forward, agreeing to provide free legal assistance.
Now, with state officials expecting a fresh surge in foreclosures in the coming weeks and months, organizers of the pro bono project say they are going to need more lawyers.
State lawmakers temporarily halted foreclosures in the spring, when they imposed new waiting periods on lenders seeking to move on delinquent mortgages. But for homes that were on the brink of foreclosure then, the extra time has begun to run out.
"We're going to have a barrage of foreclosures," said Vicki Schultz, senior adviser for consumer protection at the Maryland Department of Labor, Licensing and Regulation.
So even as the last of the more than 600 lawyers who have volunteered are being trained, an effort to recruit more is in the works. "We expect there's going to be a tremendous need, so I don't think we've tapped all the lawyers we hope to tap," Schultz said.
Officials have projected as many as 50,000 foreclosures statewide this year. Prince George's and Montgomery counties ranked first and second, respectively, in the most recent tally of foreclosures by jurisdiction. In the third quarter, 2,789 foreclosure actions were taken in Prince George's, more than a third of the statewide total. Montgomery had 1,124 foreclosure actions during that period.
By comparison, 253 foreclosure actions were taken in Charles County, 73 in St. Mary's County and 88 in Calvert County, according to a report last month from the Maryland Department of Housing and Community Development.
Maryland's Foreclosure Prevention Pro Bono Project, launched in July, is part of the state's efforts to help homeowners in danger of losing their properties. In an effort led by the Labor, Licensing and Regulation and Housing and Community Development departments, the state has backed broader legal protections for homeowners and has sought to expand access to housing counseling services.
The Foreclosure Process Reform bill passed by the General Assembly this year was the centerpiece of the state's efforts to implement new legal safeguards. Under the new law, a lender must wait 90 days after a homeowner defaults before filing a foreclosure. A notice of intent to foreclose has to be sent, by certified mail, 45 days before a foreclosure action can be filed. The changes increase the foreclosure period to about 135 days, up from an average of two weeks.
Another element of the relief program is a 24-hour hotline set up to direct struggling homeowners to organizations providing assistance. But the underlying complexity of the mortgages held by many of the people often required more attention and expertise than the housing counseling agencies were equipped to provide.
So state officials set out to enlist the legal bar to help. They went to Chief Judge Robert M. Bell, who sent a letter in July to every lawyer in Maryland. Calling the effort "one of the most important pro bono initiatives of our time," Bell wrote that the fates of thousands of homeowners were on the line, and he urged lawyers to lend a hand.
They were given a few choices: They could provide basic advice at workshops for homeowners, or they could sign on to defend individuals against lenders. Another option was to serve as in-house counsel to the housing counseling organizations, only a couple of which have lawyers on staff.
Lawyers responded "by the hundreds to the chief judge's letter," said Sharon E. Goldsmith, executive director of the Pro Bono Resource Center of Maryland, which was asked by Bell to coordinate the effort. "This project has really gone off the charts," she said.
Initially, most of the lawyers signed up to help out at the workshops, opting for the most manageable of the assistance opportunities, Goldsmith said. But after meeting with homeowners at the workshops, many lawyers agreed to go a step further and represent a homeowner in dealings with a lender. "It really struck a chord with them," Goldsmith said.
In many cases, the lawyers are able to break logjams simply because they are lawyers, said Schultz, the consumer protection adviser at the state labor department. "When you have a lawyer on the phone, most lenders bump it up one level to decision makers," she said. "That's been very effective, and that's been the heart of why we wanted to bring lawyers into the mix."
Even altruistic lawyers have to make a living, which is why the foreclosure project will need more of them to volunteer, organizers said. "Attorneys can only take so many free cases, and in a foreclosure, it's not quick and dirty," said Julie Petersen, executive director of the Bar Association of Montgomery County.
The association's lawyer-referral service is one of four organizations that the pro bono resource center lined up to connect homeowners with volunteer lawyers, and Petersen said she hopes more lawyers step forward. "I don't think we can assume that you've got this bunch of attorneys and you can keep going back to the same well," she said.
Community Legal Services of Prince George's County is another of the organizations involved. Executive Director Neal Conway said more foreclosure calls are coming to his office, putting new time demands on lawyers there. "It's created added stress" for the staff of 12, Conway said.
The Charles County Bar Association hosted a training session in May for interested lawyers, said Wilmer R. Ticer, the association's president. He said that six or seven lawyers attended the training but that he was not sure how much demand there will be for their services in Charles.
Those calls are almost certain to keep coming, said Anne Balcer Norton, director of foreclosure prevention at the St. Ambrose Housing Aid Center in Baltimore. No longer is it just the folks with adjustable rate mortgages who are showing up, said Norton, whose organization does work around the state. "We are now seeing clients in our office who we probably would not have seen but for the current economy."
Staff writer Matt Zapotosky contributed to this report.