Foreclosure Relief for the Little Guy in Minnesota
admin on November 24th, 2008
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The Attorney General of Minnesota has created a plan to remedy escalating foreclosures in the state. The proposed plan would require lenders to mediate with homeowners in an attempt to circumvent foreclosure. Minnesota is currently on track to lose an estimated $70 billion dollars in home values in the next 12 months, dramatically reducing property taxes collected and directly negatively affecting state supported programs. Under this foreclosure plan, as much as 90 days would be allowed to mediate new mortgage terms. The new loan terms could include lower interest rates and forgiven principal.
A similar plan was instituted in the mid 1980’s to aid US farmers faced with defaulting farm loans. Over 14, 000 farms were saved under the original plan in the 1980’s. Some bank critics believe Minnesota’s foreclosure process is among the longest in the nation and that states should wait on the entering federal administration’s plans before initiating new foreclosure legislation. The Minnesota attorney general responded that the relief plan addresses the “little guy,” forgetten during the discussions for the $700 billion government bailout.
