A program to allow foreclosed on homeowners, or homeowners facing foreclosure to seek a review of their distressed mortgage will come to an end on Dec. 31 unless federal officials agree to extend the deadline, a move being backed by a number of housing advocates.
The foreclosure review program has so far reached only a small fraction of those potentially eligible, homeownership advocates said during a recent telephone briefing, according to a news release distributed by the Greenlining Institute. Because the program has failed to reach its intended participants, the program’s deadline should be extended, they said.
Attempting to address evidence of widespread mishandling of home foreclosures, the Federal Reserve Board and the Office of the Comptroller of the Currency in April 2011 created the Independent Foreclosure Review (IFR) program to deal with mortgages serviced by 27 leading companies that went into foreclosure during 2009 and 2010, estimated to be 4.4 million mortgages.
So far, not one decision has been made and no compensation has been given, and only about six percent, or 260,000 of those believed eligible to receive an independent review have actually begun the process to determine if they deserve compensation for mistakes or abusive practices.
“Millions of foreclosures may have been handled wrongly, and this program is an important source of potential help – but only if people know about it,” said Greenlining Institute Community Reinvestment Director Preeti Vissa. “Last June, the Government Accountability Office (GAO) found major problems in the government and banks’ efforts to publicize and reach out to affected homeowners. While some efforts have been made to fix those problems and there has been improved outreach, there just hasn’t been time to effectively get the word out to the millions of homeowners at risk.
Alan Jenkins, Executive Director of The Opportunity Agenda, said “We cannot let arbitrary deadlines prevent us from rebuilding the American Dream.” He said federal authorities need to drop the deadline and allow applications to be submitted “for as long as needed.”
“Fully addressing the fallout from bank misconduct in the foreclosure crisis is crucial to our economic recovery, and to families across America,” said Jenkins.
Tunua Thrash, executive director of the West Angeles Community Development Corporation in Los Angeles, said very few of the people coming to them for help have even heard of the program. “It’s not fair to slam the door on people before they even know help is available.”
Those who believe they may be eligible can request an independent review online at www.independentforeclosurereview.com, or call 1-888-952-9105 for more information.