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Housing advocates welcome delay

As the issue of temporary moratoriums permeates the foreclosure crisis at the national level, housing experts in Maryland say they are monitoring the situation for local impact.

Foreclosure rates in the state this summer hit one in every 480 housing units, according to an August report by RealtyTrac. Overall, 45,676 dwellings in Maryland were listed in foreclosure between Jan. 1 and Aug. 31, the report stated. That figure is higher than in 2009, when a record 43,248 homes in the state were in some stage of foreclosure, state figures show.

Last week’s move by Bank of America to temporarily stall foreclosure proceedings nationwide could affect a portion of those homes whose lender is Bank of America, said Jeannine Dunn, managing attorney in the foreclosure prevention division of the St. Ambrose Housing Aid Center in Baltimore.

“I am not sure about the overall effect it will have,” Dunn said. “It’s a little too soon to have a read on it. But it gets time, and that’s a good thing because we want our clients and homeowners to have a fair review of their loan to see if other options are available.”

St. Ambrose housing counselors are aware that the foreclosure moratorium could be a temporary salve on a gaping wound that has plagued thousands of homeowners in Maryland since 2007, Dunn said.

The small nonprofit in the city’s Barclay community serves 40 percent of homeowners in the state who seek foreclosure counseling, totaling on average 2,500 families each year.

A state law that went into effect July 1 requiring lenders to meet with borrowers facing foreclosure in an attempt to restructure loans and avoid foreclosure has already helped to slow foreclosures and delay proceedings, Dunn said.

Baltimore City Circuit Court figures posted Tuesday showed there were 415 foreclosure filings in Baltimore city in the third quarter of the year, down substantially from the 2,101 filings in the second quarter.

“It’s not that people are not going into default, but the proceedings are being delayed,” Dunn said of the third-quarter figures that reflect the stall. “It’s a good thing if they are actually being delayed so that the servicers can review the loan for modification or other foreclosure alternatives.”

Dunn said the moratorium did not surprise her. As an advocate working with families, she said she has discovered that some of the paperwork brought in by clients to St. Ambrose has been questionable. Attempts to work out problems with lenders have been difficult because the volume of the foreclosure crisis has thwarted personal contact. Accountability, she said, could finally be within reach.

Sally Scott, a staff member of the nonprofit Baltimore Homeownership Preservation Coalition, declined to speculate whether the foreclosure moratorium will slow proceedings in Maryland. The group, she said, is alerting consumers to an array of scams currently focused on avoiding foreclosure.

“The best way to avoid these scams is to have a reliable advisor, and we have found that this is a trusted lawyer or approved housing counselor,” Scott said.