Council brainstorms to beat back foreclosures
ROCKVILLE — The number of home foreclosures in Montgomery County may be down, but don’t let the Repo Man catch you napping, a panel of experts spelled out Thursday for county council members.
“The best results are achieved when homeowners are reached far in advance of foreclosure,” said Roger Glendenning, an adviser to the council’s economic-development committee. ”Avoiding foreclosure is a win-win situation.”
And if one must come close to losing a home, then why not do it in Maryland? The state is a leader at beating back home foreclosures, and recent stats show a 20-percent countywide drop since the beginning of the year, Glendenning reported. In the 20910 zip code, which includes downtown Silver Spring, foreclosures during the same period dropped by nearly 30 percent.
One could chalk up those numbers to a state law passed in April. The emergency legislation keeps the foreclosure dogs at bey for 90 days after a homeowner defaults on a mortgage, and for another 45 days after an intent-to-foreclose notice is sent.
Downtown Silver Spring’s healthier housing market also could be due to that old real-estate mantra: location, location, location. Homes within the Beltway tend to sell in 30 days, while sales on upcounty homes can take up to a year, Meredith Weisel, with the Greater Capital Area Association of Realtors, told the committee.
Case in point: Parts of Germantown, Montgomery Village, and that neck of Silver Spring around Layhill and Bel Pre Roads are in serious trouble. Each of those spots logged more than 100 foreclosures in the second quarter of this year alone, Glendenning said. Parts of Gaithersburg, Wheaton and Calverton are also up a creek sans paddle.
So what’s a county to do? Hit the streets with mortgage counselors who can help homeowners renegotiate the terms of their loans, Glendenning pushed.
“Delinquent homeowners need to know they have a shoulder to lean on,” Glendenning told committee members. Pre-foreclosure counseling, he said, “is the backbone, and should be the core of what every jurisdiction looks at.”
There are just a couple of hitches to that. According to Richard Nelson, with the county’s department of housing, there aren’t enough mortgage counselors to go around. On top of that, there aren’t enough lenders willing to renegotiate with those high-risk borrowers.
To kick both problems, Nelson is hollering at Annapolis for help. Currently, the county and state have a nonbinding agreement to cover a reluctant lender’s loss up to 30 percent if it chooses to rework a mortgage. And the state might pick up the tab for more mortgage counselors, using money it gets from the feds, Nelson said.
“This whole cycle is going to continue for another 18 months,” Nelson told the committee. “But what we do won’t be money or effort wasted.”
Lead photo courtesy of Flickr user Respres.
One response to “Council brainstorms to beat back foreclosures”
September 23, 2008 at 1:12 pm
There will probably be massive foreclosures in and around Aspen Hill as soon as the clock runs out on the 90-day-plus-45-day “breathing space” grace period.
It’s worth pointing out to the Penguin and readers that Aspen Hill comprises two different statistical zones of 20906 (Wheaton and Silver Spring) and also a sizable chunk of 20853 (Rockville). The so-called “Layhill Triangle” demarcated by Layhill and Bel Pre Roads and Georgia Avenue is indeed a very likely spot to pick up on foreclosed properties and it will continue to be a hotspot for the forseeable future. Left out of this picture, however, is what’s happening on the other side of Georgia Avenue, in “the houses” in Aspen Hill.
I don’t need to tell most people who live around here, but for the uninformed reader who might somehow have the idea that Aspen Hill is a bucolic landscape of the gentry, let me point out that at last count, the roughly two miles of Aspen Hill Road had about 15 houses with for-sale signs, some of which have been up there for 6 months or more. In “south Aspen Hill”, usually known as the Wheaton Woods subdivision, it’s become an unquestioned barrio. The foreclosure rate there would probably be much higher that it is, if it weren’t for the massive subletting and home-overcrowded. Go to the Gazette.net site and research house fires in Aspen Hill and the articles continue to provide coverage such as “11 people made homeless” but they don’t usually directly state that these were four distinct families living in a teensy 900 square foot “knox box” with an unfinished basement.
But eventually you run out of closet space to rent, and with the economy effectively closed to all new construction work, the wolf is at the door. Expect to see these places start to fall onto the market in one mass wave. That will be in 20853 rather than 20906, but this is no more Rockville than Wheaton is.
Holler back