- About Us
- Local Savings
- Green Editions
- Legal Notices
- Weekly Ads
Mortgage settlement means relief for Washington homeowners
Washington homeowners, especially those who had their homes foreclosed, or who are currently "underwater" on their mortgages, will see some relief after one of the largest consumer protection deals in U.S. history was reached on Feb. 9.
Washington itself will see approximately $483 million in funds to help homeowners in the state.
Washington State Attorney General and Republican gubernatorial candidate Rob McKenna said this deal will right some of the wrongs that have occurred since the housing bubble burst in 2008.
"Our settlement holds America's largest banks accountable for harms homeowners suffered from shoddy loan servicing, illegal robo-signing and faulty foreclosure processing," McKenna said. "The settlement results from bipartisan cooperation among Democratic and Republican attorneys general patterning with two federal agencies. From the beginning, we have worked to help homeowners harmed by the banks' corner-cutting and to implement strict new loan servicing and foreclosure standards to prevent future harm."
According to McKenna's office, at the state level, the AG has worked closely with Gov. Christine Gregoire's cabinet agency, the Department of Financial Institutions (DFI).
"As regulators, one of the primary benefits we see from this settlement are the behavioral changes and expectations going forward that we expect these entities to live up to," said DFI Director Scott Jarvis. "We don't want to experience again what so many have gone through in this mortgage crisis and foreclosure epidemic."
Some of the provisions of the settlement include:
• Reducing monthly mortgage payments
• Loan modifications and principal reductions for delinquent borrowers
• Giving a "dignified" out for those who have no choice but to sell their home, including the possibility of receiving some funding to find a more affordable home
• The ability to refinance for those who have homes worth less than the amount owed, but who are current on their payments.
"This settlement responds to the concerns of homeowners who did everything right — borrowed what they could afford and paid their mortgages on time — but because real estate values collapsed, they're underwater, (and) have not been able to refinance at today's low rates," McKenna said. "We fought hard to make sure that many of these borrowers will benefit from the settlement."
To read the full release from the AG's office regarding the mortgage settlement and its impact on Washington state homeowners, visit www.atg.wa.gov.
Local home values
The mortgage settlement came on the heels of Zillow's Home Value Index report for the fourth quarter of 2011. According to Zillow, the decline accelerated during the last part of 2011, showing 1.1 percent decrease from the previous two quarters, and a 4.7 percent decrease overall. The average home value nationally was $146,900.
In Federal Way, the current median sale price is $191,000 — an 11.4 percent decline from one year ago, according to Zillow, which notes 84 homes sold in December 2011.
In King County, the median price of homes sold in January was $315,000, which is down 11.5 percent from January 2011, according to seattlepi.com. The report says few new listings are hitting the market, coupled with lowball offers from buyers on homes under threat of foreclosure.
Regionally, homes in the Olympia area saw an increase of 1.1 percent in December 2011, but still finished six percent lower for the year, with the average value in the state's capital sitting at $208,700. In Tacoma, home prices fell by .9 percent in December, and 13.1 percent for 2011, with the dollar value being $151,900.
Foreclosure rates edged upward in December, to 8.2 of every 10,000 homes. Foreclosure resales made up 19.1 percent of all sales in the last part of 2011, continuing an upward trend that started in August.