New Legislation To Control Foreclosure Crisis In Maryland

March 31st, 2008

To combat the ever increasing problem of foreclosure in Maryland, the state lawmakers are embarking on a very ambitious legislation which will manage the real estate crisis by intensifying the process of mortgage lending and homeowner protections. A number of bills have made advancements in the General Assembly and all these together can bring an end to the loans and corrupt practices which are responsible for bringing about the foreclosure crisis.

Most of the bills were proposed by Martin O’Malley, the Governor and they gained considerable support in the legislature that was mainly controlled by the Democrats. The measures taken would subject fraud cases to criminal prosecution. Penalties for pre-payment would also not be allowed. It would not be possible anymore to hoodwink the home-owners into handing over their properties to third-parties. If the laws are passed then the people of Maryland will be protected from losing their properties, said the secretary of labor, regulation and licensing, Thomas E. Perez. According to him, the entire situation should be viewed properly so as to understand what practices led to the current circumstances.

The crippling effects that fine prints have lead to foreclosure, and the bills are trying to do away with those ill elements present in fine prints. The volume of foreclosure has been rising at an alarming pace and during the last month itself, Maryland witnessed around 4,000 foreclosures. This shows an increase which has been ninefold since the February 2007, according to the records of Realty Trac which is a site for foreclosure information. So far, the state hardest hit is Prince George’s County, which accounts for one third of all foreclosure actions.

The legislators from Prince George’s County and some other areas have shown urgent efforts to make sure that these foreclosure bills are passed properly. According to O’Malley, the real estate crisis faced last month was a dangerous threat to the growth and strength of the middle class. William A. Castelli, vice president, The Maryland association of Realtors, said that the legislation was bound to have positive results.

Lawmakers realize that the legislation does have certain limitations. There are people who bought homes which were beyond their affordability, deliberately. These people cannot be helped in any way. Steven Silverman, the chief of consumer production division of the office of the attorney general, declared that the bills could to a large extent prevent the foreclosure crisis from spreading any further.