New Foreclosure Roadblocks From States

April 4th, 2008 | by JP Moses | in Commentary

So according to the Realtor.org buzz today, here’s what some states have been up to:

Ohio: Hired 1,000+ attorneys to work with borrowers to block foreclosures (FREE OF CHARGE TO THE HOMEOWNER!)
Illinois: Seriously considering a 60-day moratorium on some foreclosures.
Maryland: Has already enacted emergency legislation giving homeowners at least 150 days to cure defaults (basically a short-term foreclosure moratorium).
Minnesota: Considering requiring lenders to honor all borrower requests across the board for a 12-month deferment.
Massachusetts: Starting May 1, borrowers have 90 days to cure any defaults before their mortgage company can start foreclosure.

Also noted is that the Mortgage Bankers Association opposes foreclosure moratoriums.

So questions to ponder in light of this:

Do you think the states are legitimately helping the situation, or are they just delaying the inevitable?
Are these band aids going to help the healing process, or just cover up the wounds for a while longer?
Do you think these new state mandates (and others likely to come) will make the lenders MORE or LESS motivated to work with investors in loss mitigation and liquidation?