The federal foreclosure plan announced today could go a long way toward calming Wall Street. As state treasurer I see the importance of that and think action is necessary.
The plan will help in the future but it will do little to help us right away on Main Street here in Ohio at a time when our communities are being eaten alive by this crisis.
Numbers released this morning by the Mortgage Bankers Association show that Ohio is among the leading states in foreclosures on prime fixed-rate loans. This is evidence that the foreclosure problem is not confined to victims of predatory practices or risky decisions. It means that average families are losing ground in Ohio and that must end.
Congress and the President need to act now, today, to finalize the transportation and housing budget, which includes badly needed and overdue resources for communities. Communities are being destroyed by the double whammy of lost revenue and vacant properties. Local government leaders tell me that the one thing that would most help families in danger of losing their home to foreclosure is additional HUD-certified housing counselors. We could see changes within weeks, instead of years, if Congress and the President moved to enact that budget immediately.
While things have been bleak on the housing front in our state for some time, there is a glimmer of promise which the federal government and other states should note, and for which I would like to thank the state and local courts.
Chief Justice Thomas Moyer is working very hard right now on a pilot program for home foreclosure mediation in Cuyahoga, Franklin, and Montgomery counties. I urge Common Pleas courts in other counties to contact the Ohio Supreme Court and adopt this model. Foreclosure cases demand the same attention to mediation and alternative dispute resolution that we regularly give to other civil cases, which can avert a foreclosure eviction notice in many such cases.
Federal District Courts in Ohio are also acting. In recent weeks, three judges have issued orders ending foreclosure proceedings because investor groups that claimed ownership of the loans could not provide sufficient proof of ownership at the time of filing foreclosure actions. This could help level the playing field for homeowners who are trying to modify their loans but cannot determine who they should work with because their mortgage has been sold, re-sold, and subdivided so many times on the secondary market. I urge every court to review those rulings and consider whether they are applicable elsewhere.
I believe that we face today the worst housing foreclosure crisis since the Great Depression, and we need all hands on deck to resolve this complex crisis as it exists right now .
Last year nearly 80,000 new foreclosures were filed in Ohio . Actions geared toward 2010, as presented in the Bush plan, will help us in the future but do nothing to prevent catastrophe for the 200 or more Ohio families who will lose their homes tomorrow, and the next day, and the day after that. We have a responsibility to act on their behalf as well, and I urge the federal government to do so immediately.
