From the Asbury Park Press:
Homeowners facing foreclosure will get no help soon from a $30 million state rescue program because officials have suspended the effort before it even started.
The decision comes as foreclosure lawsuits in New Jersey are on pace to rise to their highest level in at least 12 years.
The state’s Housing and Mortgage Finance Agency has stopped the foreclosure rescue program after meeting with activists, who said the standards were so high that few homeowners in fiscal trouble would be able to qualify.
The delay will affect people like Stephanie L. Cannizzaro and her family in Manchester, who now face foreclosure because they cannot make payments on a high interest rate loan, commonly called a subprime loan.
Cannizzaro, 34, said she was told by state workers early this month to apply for a loan under the program. But when she did, she could not meet the stringent credit requirements.
“They’re rescuing people who are rich and had one late payment,” Cannizzaro said. “They’re contradicting themselves. They say their program is for homeowners who are suffering from predatory lending and adjustable-rate loans.”
The executive director of a nonprofit community activist group said state officials told her they had intended to start the program at the beginning of this month.
State officials said they reconsidered offering the program after meeting with the group and a state senator.
Phyllis Salowe-Kaye, executive director of New Jersey Citizen Action, a Newark-based nonprofit that provides credit counseling and also helps find financing for homeowners in trouble, said the state program’s requirementswere so tough that it would help only people who would be able to refinance in the open market.
Homeowners, like Cannizzaro and her husband, Paul, who have missed multiple
mortgage payments, have already seen their credit ratings drop precipitously, Salowe-Kaye said. Most lenders won’t touch them, she said.
Yet even if the state’s requirements were lowered, the $30 million program would provide refinancing for only about 160 homeowners, Salowe-Kaye added.
“What are they going to do with the rest of the people in danger of losing their homes?” Salowe-Kaye asked. “This should not be the only thing out there today to help people. This program doesn’t deal with the most vulnerable.”
please help me…I bought a Porshe and now I cant afford my Starbucks every morning.
I want my bailout now!
Oh my!
Glad for the result.
That program was doomed from the start, but I’m not sure the couple in the story were the right people for the reporter to talk to.
If they had a decent credit rating why were they subprime? Was this just a couple with an adjustable rate loan or did they buy more house than they could afford or did something else happen?
Either way, there’s little harm in that fund disappearing. Based on the amount of money it had, how many people could have been helped anyway?
Regardless of the liquidity and interest rate cuts the homes will still be forclosed. The declining economy will take the stock Markets with it.
At least we will have some hope when the Democrats win in 2008.
I regret I will never be able to afford the affections of Martha E Ravitz.
Based on the amount of money it had, how many people could have been helped anyway?
$30 mil? Not many.
150 garden apartments converted to condos @ $200k
or
75 POS starter capes @ $400k
or
30 $1 million prefab McMansions
In July alone, in NJ:
2,813 notices of default were filed
1,123 notices of sale were filed
215 homes were taken by the bank
The number sold under the pressure of pre-foreclosure or as short-sales are unknown.
How long would $30m last, assuming folks could be helped? If we’re talking about preventing REO, about 2 or 3 weeks worth. If we’re talking about debtors currently in default? Only a few days, at best.
jb
WOULD YOU BUY NOW IF YOU HAD GOOD CREDIT AND WERE RENTING ?
wE have good credit are renting month to month for 1/2 the going rate of 1 br’s in our area. People keep telling us Monmouth County NJ will not go down in price.
WE RE WAITING TO SEE, FEEDBACK APPRECIATED
GIO, you should wait. The market has cooled off extensively. Every realtor says that the neighboring towns/counties will be going down but not the town or county where they are selling. Summit realtors are stating that Chatham inventory is soaring and prices are off 20-30%. They also say Summit is off only 10%. They tell half a story. Summit too is off 20-30% however the realtors keep relisting under new MLS #s and dropping prices to fool the public. Dont be fooled yourself. Wait until April when prices are sure to be 15-20% less than today, maybe lower. Good luck and have patience.