Ohio House Bill to Reduce Foreclosed House Inventories

Distressed homeowners in Ohio would be helped by a bill aimed at reducing foreclosed house inventories and passed by the Ohio House on May 20. That is if the Senate and the Ohio Governor also passes the bill.

The House bill, passed 54-43, would enforce a six-month residential foreclosure moratorium statewide to give more time to Ohio families to save their abodes from being added to foreclosed house lists.

Under the bill, owners of homes at risk of being added to repossessed house lists must continue to pay half of their monthly mortgage payments.

The bill also requires mortgage lenders to pay a foreclosure filing fee of $750 and submit a current appraisal document for the property in question. It also requires the state Department of Commerce to regulate the activities of mortgage servicers.

Republicans who opposed the bill argued that the foreclosure moratorium is unconstitutional since it revises legal contracts. They added that the foreclosure filing fee restricts free access to court services.

Democratic Representative Mike Foley, who sponsored the legislation, said the six-month foreclosure moratorium would give Ohio families time obtain help to save their homes from being included in foreclosed house lists.

Another Democratic Representative, Clayton Luckie, said it is time the state does something aggressively to slow down the pace of homes being added to foreclosed house inventories.

Federal programs to help distressed homeowners have just been expanded by President Obama to reach more homeowners. The Hope for Homeowners loan refinancing program was revised to relax eligibility rules and to encourage more lenders to refinance. Both the Making Home Affordable initiative and the Hope for Homeowners scheme were strengthened with a provision in the Housing Bill that would protect mortgage servicers from investor lawsuits.

With these expanded foreclosure prevention programs and the six-month foreclosure moratorium, Ohioan homeowners would have enough time to study their options, consult with HUD housing counselors and to apply for loan refinancing or loan modifications with their lenders to save their homes from being added to foreclosed house lists.

The Ohio House bill, however, exempts small community banks and credit unions from the moratorium.

The bill also requires the state Commerce Department to monitor mortgage servicers, with particular attention to foreclosures, and instructs the department to charge servicers with an annual fee of $1,000.

In addition, the bill requires the director of the Ohio Commerce Department and the administrative director of the Supreme Court to establish and maintain a foreclosed house database.

Related Posts:

• Enhanced Foreclosure Help Program Takes Effect in California
• Ohio Foreclosure Rates fall in February, but Still High Among Other States
• Foreclosed Home Auction Could be Delayed Further in Maryland
• Slow Market, High Hopes
• Some Foreclosed Homes for Sale Might Be Due to Bank Errors