Mortgage Lenders Slam Trust-Fund Plan

Courier-Post (N.J.) (10/14/08); Ryan, Lisa G.
New Jersey's full Assembly could vote later in the month on a bill that would create a $40 million trust fund to help keep borrowers with subprime mortgages in their homes. The measure would impose a $2,000 fee on lenders that foreclose on struggling subprime borrowers, provide emergency assistance loans to homeowners, give homeowners six months to renegotiate their loans and also use some of the money to purchase and convert foreclosed homes into affordable housing. "The process being suggested is too costly and too onerous, and it could stop businesses from lending in New Jersey," warns E. Robert Levy, executive director of the Mortgage Bankers Association of New Jersey. The state had more than 134,000 subprime mortgages as of June 30, and 32.5 percent were in foreclosure or close to it, according to the Mortgage Bankers Association National Delinquency Survey.