For many months, because of federal inaction, the states acted alone to combat the rising tide of foreclosures across our nation. The plan recently announced by President Obama is a welcome effort that will help keep families in their homes. As critical details are worked out, it would be useful for federal leaders to look to the experience of states in crafting solutions.
For the past two years, we in Maryland have worked to help homeowners in distress. We passed a package of reforms that this newspaper called among the furthest-reaching in the nation. We strengthened lending and licensing standards for mortgage professionals and banned prepayment penalties and other defective features of loans. We eliminated the fast track to foreclosure to give homeowners more time to work with their lenders and develop alternative solutions that could allow them to stay in their homes.
These reforms addressed the problem prospectively, but homeowners with toxic loans continue to try in vain to get real help from their lenders. We created a hotline for citizens and convened an army of housing counselors and pro bono attorneys to provide advice. We reached agreements with six mortgage servicers to provide meaningful loss mitigation to homeowners in the state. Yet too many Marylanders still have been unable to access sustainable solutions. Our reach is limited, and most of the largest servicers fall under federal regulation. As a state, we've exhausted our options. Although we're helping more people than ever, more people than ever need our help.
Read the full article at: The Washington Post