Bar News - August 19, 2015
NH Bar Foundation News: Bank Settlement Extends Foreclosure Legal Project
By: Dan Wise
CORRECTION: The Legal Advice and Referral Center (LARC) and NHBA Pro Bono will continue to provide foreclosure prevention services at least to the end of 2016. NHLA expects to continue its foreclosure work through 2017.
The NH Bar Foundation, in consultation with the NH Department of Justice, is distributing $243,000 from a national settlement with the Bank of America to extend the Foreclosure Relief Project, a collaboration of civil legal aid providers, through to fall 2016.
About $30 million from a total $17 billion settlement with the Bank of America regarding mortgage irregularities is being distributed to the states through IOLTA programs specifically for use in “foreclosure prevention and community redevelopment” legal services. New Hampshire will receive $200,000 – a flat sum for each state – plus additional money based on the state’s share of the poverty population nationwide.
Additional settlements negotiated by federal and state law enforcement officials with banks facing prosecution for mortgage irregularities may bring additional funds for legal services programs in New Hampshire, but it is unclear how much or when, according to Charles Dunlap, president of the National Association of IOLTA Programs, who spoke on the issue at a recent national meeting for IOLTA program staff.
New Hampshire is using the Bank of America settlement to continue existing foreclosure relief programs. The three legal aid providers, NH Legal Assistance, NH Pro Bono Referral and the Legal Advice & Referral Center, provide advice and representation on loan modifications, short sales, foreclosure prevention and litigation to clients, in cooperation with housing counselors from several community groups and the NH Housing Finance Authority.
The FRP was set up with initial funding from the national mortgage settlement with five major lenders who were sued by a coalition of state attorneys general. More than $3.5 million of New Hampshire’s share of the settlement went to civil legal aid programs, which launched FRP in early 2013.
The rate of foreclosures in New Hampshire and nationwide has subsided, but many borrowers are still coping with potentially onerous loan terms. Cases in litigation where FRP attorneys, both staff and volunteer, or self-represented litigants are challenging the foreclosure process are taking years to obtain a resolution through the courts.
Two of the three partners in FRP – LARC and NH Pro Bono – are each receiving half of the Bank of America funds. NH Legal Assistance, which received the bulk of the initial national settlement and was the last to get into full operation, said it has sufficient funds to continue operating through to the end of 2016.
Ginny Martin, associate executive director for legal services at the NH Bar Association, and Connie Rakowsky, LARC executive director, said the Bank of America funding will enable their programs to continue foreclosure prevention services through the end of 2016, although at a reduced level.
Robert Adams, assistant attorney general in the NH Department of Justice, said the Foreclosure Relief Project to date has succeeded “beyond anyone’s expectations” in helping distressed homeowners to prevent or delay the loss of their homes. He praised the cooperation of the legal aid providers and the housing counselor agencies in coordinating public information efforts, training and legal advocacy.