State News

House considers expanding consumer protections

Posted July 21, 2009 1:44 p.m. EDT
Updated July 21, 2009 5:02 p.m. EDT

— North Carolina lawmakers could expand protections to help people facing foreclosure or unjust lawsuits from debt collectors targeting settled consumer accounts.

A House judiciary committee on Tuesday discussed but didn't vote on the measure. The bill has already passed in the Senate.

Attorney General Roy Cooper said consumers are plagued by companies that buy bad loans from credit card companies that have quit collecting money past due. Some of those debt-buyers then browbeat people to collect the rest of the money, he said, noting that people often can't afford to hire an attorney who would know their collection efforts go too far.

Another part of the bill would allow court clerks to postpone home foreclosures by 60 days if there's a chance to resolve a mortgage default. Cooper said the delay could bring the lender and the homeowner to the negotiating table, noting the majority of borrowers never talk to the lender during the foreclosure process.

"Have these talks been serious? Show us what you did. What were the agreements back and forth as to what was proposed," he said. "If that's good enough, the foreclosure can go through. If that hasn't been done, the (court) clerk will delay the foreclosure and say, 'Get together. Get in mediation. Talk with each other about what you can do to fix this thing.'"

North Carolina ranks 36th nationally when it comes to foreclosures. In the first six months of this yea, more than 12,000 foreclosure actions were filed, meaning one of every 326 homes statewide is in some stage of the foreclosure process.