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State tries to help more homeowners avoid foreclosure

Posted November 14, 2008

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— The state banking commission hopes a new state law regulating banks will help it more quickly find and assist homeowners facing foreclosure.

The law, which took effect Nov. 1, requires lenders to notify the North Carolina Banking Commission 45 days before they file foreclosure paperwork.

"Some people simply wait until it's too  late. They don't take any action," said Jim Richardson, of Wilson, a disabled veteran who had faced foreclosure until the commission helped him get his interest rate reduced.

Mark Pearce, the state's deputy commissioner of banks, said that behavior is why the new law is crucial.

"The eariler we can get in touch with people struggling to pay their mortgage, the more time it gives us and the better the opportunities they will have to avoid a foreclosure," Pearce said.

In October, the commission received 5,000 notices of pending foreclosures and sent letters to all those homeowners urging them to fight foreclosure. Staffers connect homeowners with counselors and other resources who can help them try to renegotiate rates so they can make payments and keep their homes.

Banking officials said they have helped more than 200 homeowners avoid foreclosure so far this year.

Ultimately, however, the bank makes the final decision about foreclosure.

Gran Yarber, president and CEO of the Raleigh-based Capital Bank, said smaller, community banks such as his have an easier time negotiating with mortgage-holders.

"We do absolutely everything we can when we run into a situation like that to help that homeowner stay in that house," Yarber said.

Larger lenders have been coming under increased pressure to become flexible in negotiating.

"I think they're going to have to," Yarber said, though it will be a challenge. "I think it's going to be difficult for them to do that, because they deal in such huge volumes."

Pearce said that reaching and helping more homeowners facing foreclosure will take more action on the part of banks, as well as the government.

"To date, the evidence hasn't been convincing to me that we've reached as many homeowners as we sould be able to reach, and so we continue to urge lenders to do more than they have been doing," Pearce said.

(Help for North Carolinians facing foreclosure is available at www.ncforeclosurehelp.org or by calling 1-888-995-HOPE.)


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  • madisongunter Nov 14, 2008

    Companies downsizing, cutting hours, cutting salaries, etc is life these days....That is a REAL problem that some homeowners are facing. I think there are very critical people that have seen hardship yet....notice I said yet, NO ONE IS IMMUNED TO MISFORTUNE!!!

  • mrduright Nov 14, 2008

    This is for all the know-it-alls posting , first of all even if you have a fixed mortgage thee price you pay today will be different next year its called insurance. If you buy a house with 10% down based on a 40,000 salary make your payments every month work hard 6 or seven days a week to build a life for your family. Only to lose it all because the company moved offshore now the jobs you can find pay less than 20,000 a year. The people who are being affected now by the crisis are the ones who are losing their jobs and can’t get new ones. I only hope you never find yourself in this situation. You would sing a different tune.

  • gnew46 Nov 14, 2008

    I agree with many of the comments here. People are where they are because they got themselves into the situation, whether it be good or bad. I vehemently oppose the $700 Billion bail out plan for banks,lending institutions, credit card companies and other entities. It does nothing but reward these firms for their own despicable behaviour and lack of business acumen. They got themselves into it and should be allowed to fail. The community banks who did not make risky loans have money and good customers. Let them take up the slack in the banking industry. They are not asking for taxpayer funded subsidies.

  • wllmbraskey Nov 14, 2008

    That's the game, if you can't afford to buy, you rent, if you understand 2+2=4, you understand your house payment may possibly go up at some point in your fantasy dreamlike lifetime.

    If you can't afford a house buy a trailer and spend your money on cell phones, ipods, beer, and a beemer, just don't tell people where you live.

    It's called life.

  • wllmbraskey Nov 14, 2008

    When I bought my house I was getting out of the army after 14 yrs. Like whatelseisnew I bought a house with a fixed rate and one I could well afford. It's been great living here in the country and I will have this house paid off in a few more years.

    I am amazed that people even have the nerve to blame others for their immature greed. It's the society now that feels owed everything in every way. Obama has inherited these losers, they are everwhere at every level of society, a human viral infection of greedy spoiled brat people. They expect to live free for free, they want pity, a cell phone, a bmw, 5 room house, etc. It's society basically imploding into a black hole where everything is acceptable and a "right".

  • Ripcord Nov 14, 2008

    Excellent idea Worland!

  • whatelseisnew Nov 14, 2008

    Worland - I like that idea.

  • Worland Nov 14, 2008

    I am so glad I have a fixed rate mortgage. I know exactly what the 1st payment, the 240th payment and every payment in between will be... exactly the same amount! No surprises.

    Of course, I decided to buy a house well within my means and not a McMansion or something to keep up with the Jones's or impress my family/friends. Even on unemployment, I could still make the monthly payment and put food on the table.

    Forgive me if I don't think anyone deserves a gov't bailout. Here's an idea... hows about I buy your foreclosed home for 35 cents on the dollar and let you rent it from me for full market value? You keep a roof over your head and I get rewarded for not being an idiot. Sounds like win-win to me.

  • Ripcord Nov 14, 2008

    I read the sign in front of that house. It says the Wall Street bankers are 'greedy'.

    I say that if you buy more house than you can actually afford and then expect responsible homeowners to bail you out YOU are the one who's greedy.

  • whatelseisnew Nov 14, 2008

    I just read the sign in that attached picture. What happened to people in this country? Why do they expect to get taxpayer bailouts? There should not have been one penny worth of bailouts to anyone. Trillions in debt at the Fed level, billions at the state and county level, and people act like there are pots of cash laying around. When did people lose their honor and independence?