HSBC Finance and Citigroup also signed on.
The accord calls for servicers to improve customer service and designate employees as contact points for Maryland homeowners, to create internal policies and incentives to encourage staff to modify loans rather than seek foreclosure, and to disclose their loss-mitigation guidelines.
Maryland officials said they have taken a multi-pronged approach to the foreclosure crisis. This year the General Assembly approved a package of legislation that slows down the foreclosure process, establishes criminal penalties for anyone who commits mortgage fraud and requires that lenders verify a borrower's ability to pay. The O'Malley administration also has rolled out refinancing programs.
Perez said he would also push loan servicers to reduce monthly payments, including by lowering the principal. According to data the state collects from some loan servicers, only one-third of troubled borrowers were able to get loan modifications as part of mitigation negotiations. Another third worked out repayment plans that involve the borrower making higher payments for a certain time.
FORECLOSURE HELP
Maryland's agreement with six loan-servicing companies calls for
* A "cooling off" period to ensure that Marylanders don't lose their homes to foreclosure while waiting for help
* Improved customer service for troubled homeowners
* New company policies to encourage staff to modify loans rather than foreclose
* Disclosure of loss-mitigation guidelines
Retailers had the weakest October in 39 years, with little relief in sight. PG 16
