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New England News

Massachusetts Funds Foreclosure Prevention Program For 10th Year

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The home foreclosure rate in Massachusetts is higher than the national average.  But there is a program now in its 10th year that state officials say is helping keep people in their homes.

The Massachusetts Division of Banks has awarded $1.5 million this year to fund foreclosure prevention centers and first-time homeownership counseling programs throughout the state. Since the inception of the program in 2008 more than $12 million has been awarded to organizations that have helped over 41,000 people according to Commissioner of Banks Terrence McGinnis.

"Anyone who is facing foreclosure is in a crisis in their lives and to face all those challenges plus losing your home is an awful situation," said McGinnis.

Grants were awarded this year to 10 consumer counseling organizations and 11 regional foreclosure prevention centers.

" We focus these grants in the Gateway communities of Worcester, Springfield and Lowell, but it has a broader impact than just the Gateway Cities," said McGinnis.

  The grants are funded by licensing fees charged to mortgage lenders.

The not-for-profit housing provider Way Finders, Inc. was awarded a grant totaling $178,492 to administer the Western Massachusetts Foreclosure Prevention Center.  The program, based in Springfield, operates in Berkshire and Hampden Counties.

Way Finders President and CEO Peter Gagliardi said the center, which opened at the height of the foreclosure crisis during the Great Recession, works with people facing foreclosure on strategies to stay in their home or leave with minimum damage to their credit standing.

"We have been happy that a lot of people have found a way through (foreclosure) and that would not have happened with the resources provided by the Division of Banks,"  Gagliardi  said.

In 2017, more than 4,700 people sought help at one of the regional foreclosure prevention centers in Massachusetts with more than 85 percent finding a way to avoid foreclosure and remain in their homes, according to the Division of Banks.

Foreclosures are still taking place, but at nowhere near the pace of 10 years ago.  Nationwide in 2017, one-half of one-percent of all properties were in foreclosure. During the housing crisis the rate was 2.23 percent.  The percentage of houses in foreclosure in Massachusetts in 2017 was .54 percent.

The scars of the foreclosure crisis remain in Massachusetts, which faces a housing shortage that has driven up prices. Secretary of Housing and Economic Development Jay Ash said a pilot program in north central Massachusetts is using urban renewal statutes to acquire bank-owned vacant houses, fix up the properties, and put them back on the market.

"Vacant properties are a blight on the community and a hazard to first responders, but as noted we need more and more housing, so we are trying to find ways to occupy ( these vacant houses)," explained Ash.

Springfield enacted a local ordinance a few years ago that required banks to pay for the upkeep on foreclosed vacant houses, but it was struck down in court.

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