AG Kilmartin Announces $1.5 Million Grant to Rhode Island Housing to Aid Struggling Homeowners

WASHINGTON, D.C. – March 29, 2013 – (RealEstateRama) — Following up on last week’s announcement of a $150,000 grant to Housing Action Coalition of Rhode Island, Attorney General Peter F. Kilmartin today announced a $1.5 million dollar grant to Rhode Island Housing and the agency’s HUD-approved counseling center.

Rhode Island Housing opened the HelpCenter, a comprehensive HUD-approved counseling center dedicated to providing professional support and education to help R.I. homeowners avoid foreclosure, in the fall of 2007 to respond to the growing foreclosure crisis. The HelpCenter’s trusted, trained HUD-approved counselors have helped more than 8,000 R.I. homeowners at risk of becoming homeless. HelpCenter counselors take a customized approach by helping struggling homeowners make sense of an existing mortgage, work with lenders and explore options to avoid foreclosure.

“Rhode Island Housing is often the first place struggling homeowners turn when needing assistance with their mortgages, and is our partner in connecting homeowners to available resources,” said Attorney General Kilmartin. “In 2012 alone, the HelpCenter at Rhode Island Housing received 2,706 inquiries. The numbers don’t lie: the housing crisis in our state is far from over, and this grant to Rhode Island Housing will enable the HelpCenter to help more Rhode Island families stay in their homes.”

“With the recent cut-backs and contraction of federal counseling funds, these new funds from the Attorney General will ensure that the HUD-approved counselors at our HelpCenter can continue to help Rhode Islanders at risk of losing their home receive counseling in a safe place,” said Richard Godfrey, Executive Director of Rhode Island Housing. “Seriously delinquent mortgages remain high in Rhode Island, and we encourage Rhode Islanders to call the HelpCenter at the first sign of having difficulty making a mortgage payment. The sooner people come to us for help, the more options they will have.”

Preventing foreclosures is a primary goal of the Rhode Island Housing’s HelpCenter. The HelpCenter, along with partners Money Management International and the nonprofit NeighborWorks centers in Providence and Woonsocket, are the primary providers of critical foreclosure-prevention counseling and services in our state.

As part of the National Mortgage Settlement, Attorney General Peter F. Kilmartin was charged with distributing approximately $8.5 million to supporting mortgage foreclosure counseling and prevention programs. In the past six months, Kilmartin has announced grants totaling over $3.8 million, including today’s announcement, to several nonprofit organizations:
• $150,000 grant to the Housing Action Coalition of Rhode Island to support their work to develop, maintain and secure affordable living situations for low-income Rhode Islanders
• $1.57 million grant to Rhode Island Legal Services to fund the Foreclosure Prevention Project
• $375,000 grant to the Housing Network of Rhode Island for homebuyer counseling, homebuyer education and outreach
• $155,000 grant to Progreso Latino to expand the agency’s Better Living Project
• $60,000 grant to HousingWorks RI to research and report on foreclosures and foreclosure prevention programs over the next three years

Attorney General Kilmartin also recently filed legislation (H5512/S0547) to reform the Mortgage Electronic Registration System (MERS). The legislation will make it easier for borrowers and regulators to determine who owns loans secured by mortgages on Rhode Island property: borrowers facing foreclosure will be able to more easily discover who owns their loans before it is too late, and municipalities will be able to identify lenders responsible for abandoned homes. The legislation will end the practice of having the vast majority of mortgages held in the name of a private registry with no interest in the loans, known as MERS. The banking industry has been using MERS since 1997, claiming it minimizes the administrative and financial burdens of the recording process for lenders. However, this practice has basically privatized the local land recording process, thereby undermining the accuracy of public records – leading to negative consequences for consumers and municipalities.

Additionally, Attorney General Kilmartin filed legislation (H5335/S0416) earlier this month that would require mortgage service providers to participate in good faith in a conciliation process administered by a HUD-approved independent agency. The goal of the process is to facilitate an agreement between the lender and homeowner to avoid a foreclosure. In 2012, 85 percent of homeowners who completed the conciliation conference process were able to reach an agreement with their lenders to avoid foreclosure and remain in their homes.