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Grim Foreclosure Numbers Spur Mortgage Reform Bills
ATLANTA – Metro Atlanta’s foreclosure notices jumped a whopping 27% this month over January.
More than 10,000 of those notices came in the 13-county metro area, according to Alpharetta’s Equity Depot.
That bad news is sure to spur on some state lawmakers who’re trying to reform Georgia’s mortgage laws and crack down on fraud.
JoAnne Hall of Decatur is one of the lucky homeowners.
Four years ago, she refinanced the mortgage on her Decatur home of 35 years for some needed improvements.
About a year later, her monthly payment on what she thought was a fixed, 30-year loan began to explode.
“It was going up, up, up so fast ’til I couldn’t keep up,” the 66-year-old disabled retired nurse’s aide told 11 Alive News on Monday.
She was able to restructure what turned out to be an adjustable loan and hang onto her home thanks to the help of Atlanta Legal Aid.
But she was one of the few fortunate ones in a sea of foreclosures.
“Left unchecked, we’ll see all of these problems arise again 5 to 10 years down the road,” says State Representative Mike Jacobs (R-Atlanta).
Jacobs chaired a House Judiciary Sub-committee hearing Monday that began studying some bills that would revamp Georgia’s mortgage laws.
HB 972 would lengthen the state’s foreclosure period to 90 days instead of the current 30 days, which is one of the shortest in the nation.
SB 57, which passed the State Senate last year and is now in the House, would make several changes, including doing away with prepayment penalties and requiring a lender to make sure the borrower can afford loan payments before signing.
Some banking groups say the wording of the laws goes too far, while some consumer advocates think the bills are too pro-banking.
Either way, they are beginning to get traction as new figures continue to show the foreclosure crisis is still around.
Meanwhile, Governor Sonny Perdue is trying to do something about another embarrassing statistic…that Georgia ranks fourth in the nation in mortgage fraud.
One of his floor leaders, Sen. Bill Cowsert (R-Athens), has introduced a bill to create a GBI Mortgage Fraud Task Force to prosecute lawbreakers statewide.
“Our interest is in where fraud took place either by the borrower or the lender or the broker in that area,” the Governor tells 11 Alive News.
Lawmakers are also looking into whether Georgia’s mortgage reform bills might conflict with similar changes being made by the U.S. Congress and President Obama.
Many still want the state to have its own tougher mortgage laws no matter what Washington does.
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