Among the new laws that went into effect Thursday is one that should be a boon for people in danger of losing their homes.
The Consumer Economic Protection Act allows homeowners and mortgage lenders to voluntary resolve foreclosures. That means homeowners and lenders can work out a plan to save the house to avoid foreclosure proceedings.
State Attorney General Roy Cooper, who worked with the General Assembly to get the new law, says foreclosures "hurt the whole economy. With this new law, homeowners and lenders get more time to rework mortgages so than more families can afford to stay in their homes."
Cooper correctly notes that not all foreclosures can be prevented, but lenders and homeowners deserve latitude in crafting a plan so people in financial trouble can stay in their homes.
He estimates that foreclosures cost lenders 40 percent of the loan value. Thus, saving a home is in the best interest of the lender as well as the owner.
The law comes as North Carolina is bracing for more mortgage defaults. Nearly 40,000 homes have gone into foreclosure so far this year, Cooper says, citing court records.
It makes good sense for the General Assembly and state leaders to do everything possible to strengthen the economy, and providing a tool to help homeowners keep their houses and mortgage lenders salvage their loans is welcome.
For more information:
Homeowners needing free counseling on options to avoid foreclosure can call 1-866-234-4857. The hotline is provided by the N.C. Commissioner of Banks.
Also try the Consumer Protection Division's Web site, a service of the attorney general's office, at www.ncdog.gov.
Also try the Center for Responsible Lending in Durham at www.responsiblelending.org.
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