Program now available to distressed homeowners
With Senate Bill 1552 taking effect tomorrow, homeowners threatened with foreclosure now have the right to meet with their mortgage servicer face-to-face in mediation before final foreclosure decisions are made. The new law also addresses a common complaint known as "dual-tracking." Mortgage servicers will no longer be permitted to foreclose while negotiations are ongoing for loan modifications or other foreclosure avoidance measures.
"This important piece of legislation will hold loan servicers accountable and ensure that Oregonians have every opportunity to stay in their homes," said Senate Majority Leader Diane Rosenbaum. "Delivering meaningful foreclosure assistance was one of the key accomplishments of the 2012 Session and we are eager to begin helping more Oregon families keep a roof over their head."
Beginning on July 11, homeowners who receive a notice of default will receive information on free foreclosure counseling and low-cost mediation services. Mediation services will be provided to homeowners at a subsidized rate of no more than $200. Funding for the program comes from mortgage servicers and from funds allocated by the Legislature from a national settlement with five large banks. Homeowners who are at-risk of foreclosure, but not in default, can also schedule mediation. During mediation sessions homeowners will be able to explore alternatives to foreclosure including loan modifications, refinancing, short sales and other options.
"By sitting down with their servicer, and a neutral mediator we're ensuring homeowners will be well informed, and that they will be heard by banks," said Representative Betty Komp. "We've passed a landmark bill that will give Oregon homeowners an important tool to help them remain in their homes. I'm excited that today middle class families and at-risk seniors can begin accessing this program."
To implement this statewide mediation program, the Department of Justice convened a 15-member work group to develop program rules. The Department of Justice contracted with a mediation service provider, Collins Center for Public Policy http://collinscenter.org to manage the mediation program.
Attorney General Ellen Rosenblum praised the group's efforts. "A tremendous amount of work has been done by community advocates, mortgage servicers and state agencies to get this important program ready on time, and within budget. We're glad that this new tool is available to homeowners and hope the program helps to turn around the foreclosure crisis that has held our state in such a tight grip for the last few years."
The Department of Justice coordinated efforts with other state agencies, including Oregon Housing and Community Services. OHCS is leading the effort to ensure that trained housing counselors are available statewide to work with homeowners before and during mediation sessions. OHCS Director Margaret Van Vliet said, "Our agency is hard at work with nonprofit organizations across the state developing innovative ways for homeowners to work with a counselor to prepare for mediation, regardless of where they live. Counselors will serve all areas of the state, and services will be provided as efficiently and effectively as possible. We know that Oregonians will be counting on these services, and are looking forward to having all of the new counselors on board."
Homeowners who want to participate in the mediation program should go to http://www.foreclosuremediationor.org/ or calling 855-658-6733.
Homeowners can find a HUD Certified counselor and learn more about foreclosure prevention by visiting www.foreclosurehelp.oregon.gov or calling 1-800-SAFENET (1-800-723-3638).