Hundreds helped by state foreclosure-prevention program

Posted October 7, 2009 11:02 a.m. EDT
Updated October 7, 2009 11:25 a.m. EDT

— More than 2,000 North Carolina homeowners have avoided foreclosure through the State Home Foreclosure Prevention Project during the last 10 months, officials said Wednesday.

Also, more than 700 homeowners statewide have taken action as a result of the Fight NC Foreclosure campaign launched last month, officials said.

”Foreclosures don’t have to happen,” Mark Pearce, the state's chief deputy commissioner of banks, said in a statement. “Calling our free hotline may be the difference between a foreclosure and keeping your home.”

Under a state law adopted in late 2008, lenders must provide homeowners and the state banking commissioner 45 days' notice before filing a foreclosure action. The law also allows the banking commissioner to extend any foreclosure-filing notice period by 30 days.

The state uses that window to negotiate with the homeowner and mortgage holder on modifying loan interest rates and payments so that people can stay in their homes.

Foreclosure filings in North Carolina are up 10.6 percent this year, officials said. According to data from the Mortgage Bankers Association, nearly three-fifths of foreclosures in the state occur on mortgages where homeowners have good credit.

Officials said the State Home Foreclosure Prevention Project has helped prevent 2,040 foreclosures and provided foreclosure prevention and budgeting advice to more than 6,000 homeowners. Officials said avoiding those foreclosures saved the financial system and neighboring property values from losses estimated at $175 million.

By using 34 nonprofit counseling agencies across the state and one national nonprofit phone counseling service, the program has prevented foreclosures in 97 of North Carolina’s 100 counties, officials said.

Fight NC Foreclosure is an expansion of the program that involves a network of state agencies, U.S. Department of Housing and Urban Development-certified counselors, legal service providers and nonprofit organizations. The public awareness campaign highlights a toll-free number, 1-866-234-4857, that homeowners needing free foreclosure assistance can call.