HARTFORD, CT - Wednesday, State Senator Carlo Leone (D-Stamford), Senate Chair of the General Assembly’s Banks Committee, welcomed a proposal by Governor Dannel P. Malloy to protect homeowners facing mortgage delinquency or who are in foreclosure, and to streamline the process for addressing abandoned and blighted properties.
“Mortgage foreclosures remain a big problem in Fairfield County and elsewhere across the state, and we must take action to help families who are struggling to keep their homes. Governor Malloy’s proposed legislation contains several promising ideas which could help to address this problem, and I look forward to reviewing the bill in greater detail when it comes before the Banks Committee,” said Senator Leone.
The governor’s proposed legislation seeks new protections for homeowners facing delinquency or foreclosure, and suggests ways to refine the mediation process to make it more efficient for borrowers and lenders. It would require that a bank representative with full settlement authority be present in each mediation session. All parties would be required to mediate in good faith or face sanctions, fines, or dismissal of the foreclosure.
The proposed bill also seeks to speed up the process for addressing abandoned and blighted properties which cause the values of surrounding homes to decline and cost municipalities needed tax revenue. In cases where a property is abandoned, the foreclosure process could be conducted in 56 days, down from 70 days.
The bill also proposes that banks should be required to fully disclose the fees they charge and the information being used against the homeowner. In addition, the Department of Banking would be enabled to disclose information required of banks on the number of abandoned or vacant properties, the number of occupied properties, the number of delinquent loans, and data on the number of loans they own or service.
The full proposed bill will be part of the Governor’s legislative package that will be unveiled on February 6th. The bill will afterward appear before the General Assembly’s Banks Committee for review and public comment.