Easley Plan To Help North Carolina Foreclosure Victims

July 7th, 2008

Governor Mike Easley has initiated plans persuading lawmakers of the state to compensate for the inaction of the federal government by coming forward with a measure that will help North Carolina foreclosure victims. More relaxation will be allowed for them to repay mortgage debts. Easley bluntly stated that they had all been expecting the federal government to come forward and be effective in their measures but so far ‘they’ve done nothing’. Hence the state decided to take steps – if nothing else it will help the foreclosure victims of North Carolina.

As per its proposal the lenders will be expected to give the sub-prime mortgage borrowers a minimum of 45 days notice before starting off on the foreclosure process. It is mostly those with poor credit history that have been peddled these sub-prime mortgages. This time will help many in working out a solution to save the houses that are their homes. Dan Blue (Democrat) is one of the main sponsors of the bill. The point is to step in before the foreclosure process kicks off because once it starts rolling more or less all hope is gone; the house is lost.

The lenders would also have to let the state know the details of delinquent borrowers. It will allow the banking commissioner of the state to work with the borrowers as well as the lenders to sincerely chalk out a plan action that will ultimately check foreclosures.

By the bill the banking commissioner will have the authority to further extend the foreclosure by another month for those house owners, who has been able to convince the state that they have the capacity to meet their commitments.

Easley hopes that the plan will help nearly 25,000 borrowers who have reached a dead end trying to grapple with the foreclosure problem. However he stresses that this not a bail out plan – the state is not taking the responsibility of paying off the loans of others or subsidizing the banks.

In 2007 North Carolina witnessed 50,000 foreclosures that calculated to a 9% increase from 2006 according to government records. In 2007 the legislators came down sharply on lending standards. It was specially so in the case of sub-prime loans that has been liberally granted without checking on the capacity of the borrowers to repay it. From henceforth new applicants will be rigorously scrutinized. However this will not help those already gasping in the foreclosure net.