Budget Cuts Aggravates Foreclosure Situation in Georgia
In Georgia the foreclosure situation is grim with one out of every eight mortgages being affected. Budget cuts have further aggravated matters. The resources that the state had for helping the victims are now shrinking. Most of the staff so far employed in handling mortgage problems has been given marching orders. Now there is only one full timer working against the clock to handle the innumerable complaints. The state with a budget deficit of $2 billion did not have any other option but to take this drastic step.
Hitherto there were four persons employed in the Department of Banking and Finance. Their job was to guide the complainer through the formalities of the process, review relevant documents, forward any sort of information that was required to the various regulatory departments and work in general to resolve the issue, said Judy Newburry, the Deputy Commissioner for Legal and Consumer Affairs.
The one single staff member cannot possible perform all these functions. He is able to give out a list of help that can be availed of from outside. By doing so – fraudsters are seeing big opportunities to chip in. 500 mortgage complaints were noted in 2007 according to the department. It is not sure how many are getting help today since complaints are no longer tracked.
It has been the worst time for such a thing to happen. Foreclosures are increasing and more people are in need of help. Fraud too is increasing. The federal government has initiated a programme involving $75 billion to address the foreclosure problem by modifying and refinancing loans. Attorney General Eric Holder said that in April the FBI took charge of huge numbers of fraud cases – 400% higher than in the previous five years.
Other states have been keeping pace with the surging tide of foreclosures by increasing their help programmes. Arizona launched a help line in 2008. Nevada, Colorado and Michigan have all set up hotlines for the foreclosure victims to ask for assistance and report cases of fraud. Florida’s hotline has been flooded with complaints in 2008. An operator on the hotline in Florida noted “Caller is very upset and crying. Caller says that Wells Fargo did not turn her over to a collection agency. Wells Fargo told her that this is theft and to make sure we know about it.” The caller had said that she had paid $1,000 to someone who claimed to be a collector of debts!