NH Plays Waiting Game For Foreclosure Settlement Money
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It will be awhile before NH sees a dollar of the historic bank settlement
After announcing New Hampshire’s share of a $43 billion multi-state settlement with the country’s biggest banks, the Granite State’s officially in waiting-game-mode. Although the settlement was announced in February, it didn’t get the official approval until April. Now, banks have to sift through paperwork, which could take months. As Jake Berry explains in the Nashua Telegraph:
“Because the money will be distributed directly from the five banks [Bank of America, Citigroup, GMAC, JP Morgan Chase, Wells Fargo], rather than the state or federal government, it’s impossible to tell how many people will receive money under the settlement. But Delaney said Monday that the number of homeowners calling the attorney general’s office for assistance has tripled since the settlement was announced.”
And in case you need a refresher, Lynne Touhy reported for the AP following the settlement announcement how the money breaks down:
“About $4.5 million, Delaney said, will provide lump sum payments of about $1,800 to homeowners who were foreclosed on by those five banks after Jan. 1, 2008.Related
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But the lion’s share of the money — $19 million — will be used to help struggling homeowners stay in their homes by reducing their principal balance if their mortgages are held by the five banks.
‘At least 60 percent must be allocated to reduce the principle of borrowers who are in default or who are at serious risk of default,’ Delaney said. The balance would help facilitate short sales and fund payment forbearance due to unemployment.
An additional $9.5 million will be used to help homeowners who have zero or negative equity in their property refinance by lowering their principle balances. To qualify for this assistance, homeowners must be current on their mortgage payments, have a current interest rate in excess of 5.25 percent and their mortgages must be held by one of the five banks in the settlement.”
Meanwhile, in today’s Telegraph story, Berry writes that once the money comes down, the state shouldn’t expect immediate relief:
“Since 2008, more than 3,000 families have lost their homes to foreclosure each year, according to state figures. Those numbers are more than six times higher than 2005 when 500 homes were lost to foreclosure, Delaney said. And with the housing crisis still in effect, the numbers will likely remain high for another year or two, he said.”
