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Senate approves foreclosure mediation bill

Post by Katie Schmidt on March 29, 2011 at 12:48 pm |
March 29, 2011 12:48 pm

A bill to set up a foreclosure mediation process for troubled Washington homeowners cleared another hurdle in the state Legislature today.

The proposal, House Bill 1362 passed the Senate in a 36-11 vote, and, if it becomes law, supporters said it would go a long way toward keeping state residents from losing their homes.

“All in all, it should keep in their homes many of the anticipated 70,000—let me repeat that number, 70,000—Washington homeowners who are expected to receive notices of foreclosure this year,” said Sen. Adam Kline, a Seattle Democrat, during floor debate on the bill.

The bill still needs to be reconciled with the version that passed the House and signed by the governor to become law, but if that happens, it would increase the number of housing counselors in Washington, set up third-party mediation and extend a requirement that lenders “meet and confer” with borrowers facing foreclosure. The measure would be funded through a $250 fee banks would have to pay every time they foreclose on someone.

Sen. Don Benton, a Vancouver Republican voted against the measure. He said he had misgivings about the proposal, mainly because he worried that banks would pass the expense from the fees onto consumers, affecting people who had been careful not to borrow too much against their homes.

“The Legislature cannot make people more responsible in terms of their financial decisions,” Benton said.

According to the Web site Realty Trac, Washington has had 9,366 new foreclosures so far this year, mainly in King, Pierce and Snohomish counties.

 

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