National foreclosure trackers report that foreclosure activity across the United States has hit a 6-year low, dropping 23 percent from this point last year alone. While the general trend is downwards, certain states are still seeing agitated foreclosure activity. States such as Florida and New Jersey have witnessed foreclosure increases by 55 and 91 percent respectively. Now, to protect homeowners and slow the growth of foreclosures, 26 states are implementing new legal procedures where foreclosures go through the courts instead of the banks. By managing foreclosures in this way, states hope to dramatically slow foreclosure filings.
Oregon Experiments with Foreclosure Programs
Oregon is one of the states providing major assistance for homeowners who are struggling with their mortgage debt. Traditionally, homeowners in Oregon could seek help and protection from the Oregon Housing Stabilization Initiative, but May 2013 is the last month in which applicants will be accepted into the cycle. Instead, Oregon is testing their new Loan Preservation Assistance Program, which provides up to $20,000 for homeowners to battle late fees and their outstanding mortgage debt. The goal is to give homeowners the tools to make payments by themselves. By providing assistance, the state of Oregon hopes to lower the rate of foreclosures.
However, the spokesman for the Oregon Housing and Community Services states that participation rates for this new program are disappointingly low. In fact, out of over 2,000 people who were eligible for support throughout Oregon, less than 800 applied and only 319 were approved. While the program offers up to $20,000, the average assistance for homeowners so far has hovered around $10,000. These programs by Oregon are funded through the U.S. Treasury’s Hardest Hit Fund.