The HOPE Initiative – Combating Foreclosure in Maryland

 In order to help as many families affected by the foreclosure crisis as possible, Maryland has reformed state laws, provided counseling and financial assistance and in turn has become a national leader in foreclosure prevention. Maryland continues to provide leadership and creative responses to the foreclosure crisis with expanded counseling services and outreach efforts.

• Created a Collaborative Agenda to Address Foreclosures

  Governor O’Malley created the Homeownership Preservation Task Force in 2007 to initiate Maryland’s agenda to combat foreclosures. The primary goal of the task force was to assess the scope of the potential foreclosure problem in Maryland and recommend ways to prevent foreclosure and preserve homeownership.
  Read the Task Force’s Report

• Reformed State Law

  2008 Session of the General Assembly

  • SB 218 / HB 361 – Protection of Homeowners in Foreclosure - Prohibition on Foreclosure Rescue Transactions - Enforcement – An emergency bill that bans foreclosure rescue transactions that scam homeowners out of their homes and the equity they’ve built. Provides additional consumer protections for people who are trying to sell their homes because they are in default.
  • SB 270 / HB 363 – Credit Regulation - Mortgage Lending and Other Extensions of Credit - Requires lenders to verify a borrower’s ability to repay a loan; authorizes the Commissioner of Financial Regulation to set mortgage lender licensing fees and examination requirements; and expands the licensing requirements for mortgage lenders and mortgage originators.
  • SB 217 / HB 360 – Real Property - Maryland Mortgage Fraud Protection Act - A comprehensive criminal mortgage fraud statute that makes mortgage fraud a crime for anyone involved in the mortgage transaction.
  • SB 216 / HB 365 – Real Property - Recordation of Instruments Securing Mortgage Loans and Foreclosure of Mortgages and Deeds of Trust on Residential Property - Significantly lengthens the foreclosure process from 15 days to approximately 150 days, making it fairer for homeowners and providing them with more time and notice before a foreclosure sale.

  2009 Session of the General Assembly

  • SB 842 / HB 776 – Real Property - Foreclosure of Mortgages and Deeds of Trust on Residential Property - Notice to Occupant - Enhances notice requirements passed during the 2008 legislative session to now also include occupants to help inform renters of foreclosure actions pending against their landlord.
  • SB 269 / HB 292 - Financial Institutions - Mortgage Lenders and Mortgage Loan Originators - Revises the State’s mortgage lender and mortgage loan originator laws to conform to the requirements of the federal Secure and Fair Enforcement Mortgage Licensing Act of 2008 (SAFE Mortgage Licensing Act).

• Targeted Assistance to those Most in Need

  Maryland has worked to target assistance to Maryland communities most affected by foreclosure through data analysis and research. Foreclosure statistics by jurisdiction, as well as other research and information on foreclosure is available here.

  Foreclosure Events in Maryland, 2009 Q1

  Foreclosure Activity in Maryland, 2008 & 2009

• Helped Homeowners Find Assistance by Organizing and Facilitating Financial Support for Counseling

  DHCD supports a network of 31 nonprofit agencies to provide foreclosure prevention assistance Statewide. The funds that have been allocated support operating costs for the agencies that are providing assistance. In FY 2008 and FY 2009, Maryland Housing Counselors assisted more than 23,000 individuals achieving more than 7,900 Positive Outcomes. DHCD continues to provide quarterly training sessions for all the counselors in the network.

  Financial Support for Housing Counseling, 2007 – 2009

  Funding Initiative	Amount
  TOTAL	$5,682,450
  HOPE Round One, Summer 2007	$1,299,493
  HOPE Round Two, Spring 2008	$1,751,697
  HOPE Round Three, Spring 2009	$2,131,260
  Supplemental Funding From Governor, Spring 2009	$500,000

  
  

  Counseling Financial Assistance, FY07 - FY09

  Housing Counseling Activity FY09

  MD Housing Counseling Activity, February - June 2009

• Coordinated Legal Assistance

  The Court, through the Pro Bono Resource Center, the Maryland Bar Association, along with the State, through DLLR and DHCD, have worked with Civil Justice and other partners to train attorneys to assist Maryland homeowners. More than 700 attorneys have volunteered to be part of the Foreclosure Prevention Pro Bono Project, and are helping homeowners at workshops, by taking cases and by advising nonprofit housing counseling agencies.

  Homeowners Counseled and Referred to Legal, FY09

• Created the MD HOPE Hot Line 1-877-462-7555

  The MD HOPE Hotline provides information on the location of housing counseling agencies in communities where individual homeowners need help. The Hotline also guides callers to pro bono attorneys and fraud investigators if these are needed. The singular message of the HOPE Hotline is, "If the mortgage is late, don’t wait!" The MD HOPE Hotline was created to provide fast information on housing counseling for homeowners facing foreclosure in Maryland.

  MD HOPE Hotline Data

  Fiscal Year	Total Calls
  TOTAL Calls to Date	25,683
  Calls in FY 2008	8,525
  Calls in FY 2009	17,158

  
  

  HOPE Hotline Data , FY08 & FY09

  HOPE Hotline Calls, by County FY08 & FY09

• Created the MD HOPE Website

  Created mdhope.dhcd.maryland.gov as a one-stop resource for Maryland residents facing foreclosure. Since inception, the Website has attracted 181,000 visitors.

• Created the Maryland Servicer Initiative to Streamline Loan Service Response to Homeowners

  Early in 2008, Governor O’Malley announced plans to meet with servicers to address the problems homeowners and counselors were having accessing meaningful loss mitigation. Representatives from major loan servicing companies, as well as Fannie Mae and Freddie Mac, met with the Governor and Administration officials in February and March. Following intense negotiations and discussions, six servicers (AmeriNational Community Service, Citi, GMAC ResCap, HSBC, Litton and Ocwen) agreed to abide by a 5-point framework for a streamlined and transparent loss mitigation process. This agreement ensures that assistance is made available to homeowner sooner and provides clear information on mortgage loan servicing.

  Maryland’s 5/10/60 Loss Mitigation Timeline

  • 5 days to acknowledge receipt of packet
  • 10 days to confirm it is complete
  • 60 days to make a decision and while a decision is made halt foreclosure action and penalties
  • Dedicated resolution contacts

• Reached At-Risk Households through Events, Marketing, and Communications

  DHCD has taken its message, “Mortgage Late? Don’tWait!” to thousands of Marylanders in danger of foreclosure. Whether through direct mail, radio and print advertising or bus shelters and billboards, homeowners from Prince George’s County, Baltimore City, Montgomery County and every other county in Maryland are receiving the word – "If your mortgage is late, don’t wait. Call 1-877-462-7555 today."

  DHCD MD HOPE Outreach, Communications, and Marketing Activity, FY 08 & FY 09

  Media	FY08	FY09	TOTALS (Apr 2008 - Jun 2009)
  Press Releases	5	52	57
  Print	6	62	68
  Radio	3	9	12
  TV	1	11	12
  Advertising	FY08	FY09	TOTALS (Apr 2008 - Jun 2009)
  Print	381	20	401
  Radio	1,763	5,855	7,618
  TV	0	173	1,173
  Direct Mail	680,000	0	680,000
  Billboard	165	110	275
  Bus Ads	4,185	2,780	6,965
  Non-traditional Advertising*	0	191,756	191,756
  Outreach Events	FY08	FY09	TOTALS (Apr 2008 - Jun 2009)
  Events	85	154	239
  Event Attendees	11,594	26,058	37,652
  Collateral Distributed	10,174	47,448	57,662
  Brochure Requests	79	122	200
  Pieces Mailed	51,225	33,226	84,451

  *Movie Ads

  
  

  HOPE Targeted Mailings

  Map of HOPE Outreach Events, FY08 & FY09

  
  

• Protecting Communities by Addressing Vacant and Foreclosed Homes in Maryland

  Neighborhood Conservation Initiative (NCI) helps local jurisdictions stabilize communities hardest hit by the foreclosure and subprime lending crisis. DHCD is administering $26.7 million of the $46.3 million allocated by the U.S. Department of Housing and Urban Development to Maryland through the Neighborhood Stabilization Program. The funds are being used to help address the blight of abandoned houses in their neighborhoods caused by the foreclosure crisis.

  • Neighborhood Conservation Initiative (NSP I)

  Neighborhood Conservation Initiative Awards, March 2009

• Worked to Address Fraud and Protect Homeowners

  The Office of the Commissioner of Financial Regulation maintains a dedicated team of examiners and investigators to identify and combat mortgage fraud. The agency recovered approximately $2.9 million for Maryland consumers in Fiscal Year 2009, primarily related to its mortgage activities. In addition, the Office of the Commissioner of Financial Regulation has:

  • Uncovered a $35 million foreclosure rescue scam involving the Metropolitan Money store which has resulted in 10 guilty pleas to date
  • Taken aggressive action against “loss mitigation consulting” schemes which illegally charge consumers up-front fees by promising to obtain a loan modification on their behalf including 17 cease-and-desist actions in the past four months
  • Pursued an illegal payday lending operation that was abusing the state court system to enforce illegal lending contracts resulting in the dismissal of confessed judgment and associated garnishment actions against hundreds of Maryland consumers
  • Worked to better inform property owners of pending foreclosure actions by mailing 127,000 Notices of Intent through June 2009.