Delaware moves to strengthen forclosure protections
Monday, October 5th, 2009
The State of Delaware wants to make sure families facing foreclosure don't fall prey to predatory lenders.
Governor Jack Markell signed House Bill 232 into law Monday. It makes clear that companies which negotiate modifications to secured debt, like mortgages, are subject to the Mortgage Rescue Fraud Protection Act and cannot charge thousands of dollars in up-front fees to negotiate with lenders.
“Mortgage ‘rescue’ companies have the upper hand when negotiating with financially-distressed homeowners struggling to keep their homes,” said Attorney General Beau Biden. “This legislation makes it crystal clear that these vulnerable homeowners are protected under Delaware law from predatory practices.”
"Delawareans should be aware that these services are actually available for free from HUD approved housing agencies, so there is never a need to to pay for them." said Markell.
The new law is the latest in a series of moves by the state to deal with the foreclosure crisis.
Last month, the Foreclosure Mediation Program was established which allowed homeowner to participate in a court mediation process with lenders in an effort to find a mutually agreed alternative to foreclosure.
Last June, the State Attorney General's office formed its Mortgage Fraud task force to help direct homeowners in trouble to government counseling and assistance programs while ramping up law enforcement efforts against foreclosure scams.
Homeowners who suspect a foreclosure scam or have foreclosure questions can call the Attorney General's mortgage hotline at 1-800-220-5424