A trio of Democratic legislators are touting a trio of bills which they say will help address the mortgage crisis. One bill sets up a new, $5,000 penalty if a mortgage broker fails to disclose to the borrower any fees or key details a on home loan.
Representative Paul Shomshor, a Democrat from Council Bluffs, says it’s similar to the disclosure standards in other professions. "It’s not a cure-all for every foreclosure in this country," Shomshor says, "but we think it’s some disclosure to the borrower that could be very helpful."
Representative Larry Marek, a Democrat from Riverside, is sponsoring a bill which would forbid foreclosures on reserve soldiers’ homes while they’re on active duty. That foreclosure prohibition already exists for active duty National Guard soldiers and those in the regular military.
"I’ve served in the National Guard myself, a number of years ago, Since I’ve served, my unit has gone to Iraq at least twice and they’ve gone to protect our interests, so the least we can do is to protect their interests when they get home," Marek says. "They need time to recover and they don’t need to be pressed with losing a house."
Marek’s foreclosure prohibition, however, does not extend to the first months of a reserve soldiers’ return to civilian life and only applies to their time on active duty. Representative Phyllis Thede, a Democrat from Bettendorf, is sponsoring a bill which would require lenders to give borrowers the number of the Iowa Mortgage Foreclosure Hotline when a bank or other financial institution starts to foreclose on a home.
"And hopefully this will provide some relief to families that are going through this very serious crisis," Thede says. In February of 2008, the Iowa Attorney General converted the Iowa Concerns Hotline into the Iowa Mortgage Helpline.
In the past year, the hotline’s operators have taken about 5,500 phone calls and almost 4,000 Iowans have sought help in dealing with a home foreclosure. About one-quarter of the borrowers the attorney general’s staff worked with got modications in their loans.
The hotline number is 877-622-4866, or you can go to the Iowa Mortgage Hotline .