Two bills working their way through the legislative process this year will help to continue Connecticut’s foreclosure mediation program for another two years. The funding for the program is now scheduled to expire in June.
Rep. Larry Butler, D-Waterbury, chair of the Housing Committee said continuing the program at this stage is important because even if the economy turned around tomorrow, foreclosure problems will linger for years to come.
The two bills, similar in language, not only continue funding the program but also include provisions to allow homeowners in mediation to participate in the program without simultaneously engaging in court litigation. Click here for House Bill 6463 and here for House Bill 6351.
Currently property foreclosures proceed down two tracks at the same time. Homeowners who enroll in mediation must also participate in court litigation. That can be a draining process, Rep. William Tong, D-Stamford, chair of the Banking Committee said.
The legal language around foreclosures is so arcane and confusing, Tong noted that even as a lawyer he has difficulty navigating them.
“And if you could afford to pay a lawyer, you could afford to pay your mortgage,” Tong said at a Monday morning press conference.
As a result people sometimes end up giving up legal rights without realizing it, he said.
That’s why a big part of what’s done at the Connecticut Fair Housing Center is teaching homeowners how to represent themselves in foreclosure proceedings, according to the organization’s attorney Jeffrey Gentes.
Since the mediation program began in July of 2008, homeowners of around 9,500 properties have completed the program, Gentes said. But around 1,500 properties have been foreclosed on despite their owners being enrolled in the program, he said.
The two proposed measures would protect against that. That could be a good thing for ailing homeowners considering the program has yielded some results. Since its inception, more than 75 percent of the cases in the mediation program have been resolved without the courts getting involved, Tong said. Of those cases about 66 percent of the homeowners stayed in their homes, he said.
Rep. Bruce Morris, D-Norwalk, said he’s personally been dealing with constituents who have been in the foreclosure process. One woman in his district who contacted him for support said she was a widow with two sons, he said. She was in the mediation program but the business she runs was failing and the litigation process was consuming her, he said.
Morris ended up involving a U.S. Congressman who helped to negotiate with national lender but he said her story illustrates the stress the foreclosure process puts on homeowners. Tong said that if buying your first home is one of the most exciting experiences in one’s life, then facing a mortgage foreclosure is one of the most traumatic.
But Butler said despite that trauma others have found ways to capitalize on the confusing nature of the process to defraud suffering homeowners.
“People find these other people at the most difficult time and they prey on them,” he said.
So the news conference Monday also served to highlight existing resources for homeowners in trouble. Those resources include mediation classes being offered across the state that provide attendees with an 80-page manual to guide them through the process. But Tong and Butler said they’re also “taking their show on the road.” The two will be at the Danbury City Hall Monday night at 7 p.m.