Foreclosure Crisis Front and Center in Washington

The Secretary of HUD (Housing and Urban Development) Shaun Donovan recently appeared in an interview on CNBC to discuss the current mortgage crises, what some are calling “Foreclosuregate.”

During the interview, Secretary Donovan stated with respect to mortgages that are being reviewed, “We’re not finding any evidence of underlying structural issues in the mortgage market….This is really about particular institutions not doing their job.” He continued on to state “I think the real issue that we’re focused on are banks doing what they are required to do…and what they should be doing to keep people in their homes.” Secretary Donovan’s interview comes at the same time as multi-agency meeting is convened in Washington, including HUD, the Treasury, and the Department of Justice, to address the issue of foreclosures.

What does this mean for homeowners who are facing foreclosure? Given the fact it has been a couple months since news began breaking of possible foreclosure fraud (such as robosigners) on the part of banks and Washington is just now trying to sort things out, it does not seem that legislation aimed at helping homeowners will be arriving any time soon. Banks may try to be a little more careful with their books now that they know Washington is paying attention to them. However, with literally hundreds of thousands of foreclosures in line for processing, banks will probably remain more focused on their bottom line than working with homeowners to keep them in their houses. Homeowners would be wise to take matters in their own hands , either by retaining legal counsel or trying to work with banks themselves, rather than waiting on relief from lawmakers.

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