Foreclosure not the end for homeowners

The housing advocacy director of Legal Services Alabama has a message for homeowners facing foreclosure—don’t give up.
According to Kenneth Lay, who spoke at the Houston County Bar Association meeting at the Dothan Country Club on Wednesday afternoon, many of the people facing foreclosure may be able to avoid losing their homes.

“Unfortunately, a lot of these situations arise because of a lack of income, and there’s nothing we can do if somebody lost their job or something like that, but we have found that because of political and now financial pressure, the mortgage companies and large banks are much more willing and even desperate to work things out,” said Lay, who represents Legal Services Alabama, a state and federally funded nonprofit organization. “We’ve seen things where they have had 12 or 13 percent interest and dropped to 5 or 6 percent, added terms on the end of the loans, et cetera.”

Now, thanks to a federal grant, more people than ever before can seek help in solving their mortgage crises.

“We have a grant from the Department of Housing and Urban Development to help owners before and to prevent foreclosure,” Lay said. “We have a foreclosure prevention grant to counsel people and try to help work out mortgage agreements. It allows us to provide counseling to any client, regardless of income, and we can be there to help negotiate with lenders and try to reach agreements.”

According to Lay, the problem of mass foreclosures in the housing market isn’t going away anytime soon, but Alabama residents are better off than most.

“At Legal Services, we’ve been overrun with foreclosure cases,” Lay said. “Alabama is actually lucky, though. For once, we’re not in the worst situation. We have averaged in foreclosure rates anywhere from 37th to 42nd, so we are much better off than the majority of the country. Georgia, for instance, is in the top five worst, because of the Atlanta area.”