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September 19. 2012 10:10PM

Help on the way for NH's foreclosed

NORTHFIELD — Distressed homeowners facing mortgage foreclosure are getting some help.

The Executive Council approved about $10 million for use over three years for legal assistance, fraud protection and counseling in three separate contracts.

A new unit within the Attorney General’s Office and contracts with New Hampshire Legal Assistance and New Hampshire Housing Finance Authority are all being paid for by the National Mortgage Settlement.

New Hampshire was among 49 states that signed an agreement with the five largest banks in the country, Bank of America, Citibank, Wells Fargo, J.P. Morgan Chase, and GMAC/Ally, to settle claims involving their mortgage servicing and foreclosure practices.

Nationally, the banks agreed to send $25 billion to consumers and the states, with $20 billion in direct benefits to borrowers, mostly through change of terms.

New Hampshire’s share will be $44 million, with approximately $34 million in direct relief to borrowers.

At a breakfast at the Spaulding Youth Center before Wednesday’s Executive Council meeting, Attorney General Michael Delaney briefed the council on changes he made to the original contract request, which was tabled Aug. 22.

The New Hampshire Housing Finance Authority would receive $2.5 million to counsel homeowners; another contract is with the New Hampshire Legal Assistance and the New Hampshire Bar’s pro-bono referral program for $1.5 million.

The money would also will pay for full-time temporary positions of an attorney, investigator, managing financial analyst, paralegal and a secretary to investigate and prosecute mortgage fraud.

Executive Councilor David Wheeler expressed concern there was a lack of accountability and cast the only dissenting vote against the measure creating the new legal unit.

But he agreed to the other contracts on a one-year, renewable basis.

In a news release issued later in the day, Delaney said about 7,600 New Hampshire residents who lost their homes between Jan. 1, 2008, and Dec. 31, 2011, due to an improper foreclosure process should receive a mailing next week telling them how to file a claim for funds. Those who do not receive a form, but think they are eligible, can call 1-866-430-8358.

Delaney said most of the problems involve national banking organizations, especially Bank of America, which has not provided his department with requested information on New Hampshire property owners facing foreclosure.

Executive Councilor Ray Burton said several community banks in his district are concerned there will be more regulators, but “I am willing to go with more legal assistance ... and stop these foreclosures so they can stay in their homes.”

John Tobin, director of New Hampshire Legal Assistance, said in the past five years, none of the cases his organization has handled have involved New Hampshire community banks.

“We don’t expect we will be fighting against New Hampshire’s community banks,” Tobin said.

Executive Councilor Dan St. Hilaire was concerned that the only people who can qualify for legal services are those who have incomes up to 350 percent of the federal poverty guideline.

He said he knows of people who have higher incomes who are “fighting a David and Goliath battle” with the big banks.

Delaney agreed to take the language about financial limits out of the contract and noted there are “exceptional cases,” but that the majority of the effort would go to those who have lower incomes.

The vast majority of those facing foreclosure earn below $40,000 a year, he said.

For more information, go to nationalmortgagesettlement.com.

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Paula Tracy may be reached at ptracy@unionleader.com.



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