The newly revamped Oregon Foreclosure Avoidance Program has received 456 meeting requests since its unveiling six weeks ago. Significantly, the vast majority of those requests came from lenders, most of which declined to participate in the program in its first year of operation.
That’s an enormous jump from the corresponding six weeks of 2012, when private lenders referred just one case to mediation. In the first 13 months, lenders sent 286 pending foreclosures through the program.
Indications are that in coming weeks some of the nation’s largest banks could refer hundreds of additional cases to the new program.
"No one's happy about impending foreclosures, but we're delighted with these numbers because, unlike the earlier program, it means this one is working the way it's supposed to,” said Oregon Attorney General Ellen Rosenblum.
“We worked hard to close the loophole that allowed banks to avoid face-to-face meetings with borrowers. We remain hopeful that getting lenders and borrowers together at the same table will help prevent foreclosures and keep Oregonians in their homes.”
Key to the new volume is Senate Bill 558, which became law last spring. The bill made both non-judicial and judicial foreclosures subject to the meeting requirement. Under the prior program, only non-judicial foreclosures required the face-to-face meetings. Many lenders moved to judicial foreclosures.
Under Senate Bill 558, a lender who intends to foreclose must first request a meeting with the homeowner. The administrator of the program will notify the homeowner of the request. The letters will be from the Oregon Foreclosure Avoidance Program.
The homeowner has 25 days to respond. The homeowner must pay a fee -- $50 or $200 depending on income -- and provide some financial information to the lender. The lender must provide payment history and a copy of the loan documents to the homeowner.
“It’s important that people interested in meeting with their lenders be proactive and respond in a timely manner,” Rosenblum said.
The housing market has shown steady signs of improvement in 2013. Prices are up and delinquencies are down. But 28,599 Oregon homeowners remained 90 days or more delinquent on their mortgages as of June. That’s 4.85 percent of all homeowners in the state, a level far beyond historical norms.
Face-to-face meetings won’t magically end the foreclosure problem. Many embattled homeowners have moved and can’t be located. Others lack the resources to pay even a modified mortgage. But the changes to the law have forced the lenders to the table in much higher numbers, which is a positive first step.
For more information on the Oregon Foreclosure Avoidance Program, go to http://www.doj.state.or.us/consumer/pages/foreclosure_mediation.aspx
Additional foreclosure-related information is available at OregonHomeownerSupport.gov and 1-855-412-8828.