Governor tackles mortgage problems

Says foreclosures 'hurt communities'

John Rebchook, Rocky Mountain News

Published February 3, 2007 at midnight

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Gov. Bill Ritter said the state's chronic foreclosure problem hurts entire communities, not just those losing their homes.

Ritter doesn't have a detailed plan for how to curb the problem but acknowledged several measures in the works.

"This is a case where an ounce of prevention is worth a pound of cure," he said at a news conference Friday at the Capital.

A positive step was the creation three months ago of a public-private foreclosure hotline.

"It's not just individuals who are hurt by foreclosure, but it is the communities around them that are impacted by it," Ritter told the Rocky Mountain News following a news conference at the Capitol that brought together state and federal government officials, as well as private groups fighting the foreclosure crisis.

Since the hotline was launched in October, it has received about 8,400 calls, said Kathi Williams, executive director of the Colorado Division of Housing.

The hotline is being operated with no cost to the state. It has received about $450,000 from groups that include Freddie Mac, HUD, the Colorado Association of Realtors, the Colorado Mortgage Lenders Association, JPMorgan Chase Bank, U.S. Bank and Fannie Mae.

"The hotline is a national model," said Kirk G. Willison of Freddie Mac, who was in Denver this week.

Ritter said requiring mortgage brokers to be licensed "is something that merits a conversation. . . . I'm in favor of having that conversation."

Ritter said he has not seen a proposed law supported by Attorney General John Suthers, which is aimed at curbing the foreclosure rate in Colorado.

That rate, according to RealtyTrac, is the highest in the nation.

Suthers on Thursday night said he received an e-mail that afternoon from a woman who claimed that her monthly payment had jumped from $500 to $2,400.

Suthers asked her to send his office her paperwork but said he suspects that she willingly signed a bad loan, and there's nothing his office can do.

"That is unconscionable," Willison said.

Top reasons for mortgage payment delinquency

41.5%

Unemployment or curtailment of income

22.8%

Illness or death in the family