Wright-Patt Moves 'Out Front' on Foreclosures
FAIRBORN, Ohio -- With Ohio heading the list of states with the highest foreclosures, the $1.26 billion Wright-Patt Credit Union said last week it is pushing ahead with new referral and counseling programs to assist stressed homeowners.
"It is imperative on this issue we be out front with our members which is one reason we've teamed up with a nonprofit agency working closely with the public," explained Tim Mislansky, senior vice president, describing a linkup with the Home Ownership Center of Greater Dayton.
While Wright-Patt has focused on building a volume of first-time mortgages, the CU is now co-operating on referrals with the nonprofit Home Ownership to assist beleaguered borrowers unable to make ARMs payments or facing economic difficulties.
Pointing to the mortgage meltdown, Mislansky said "conditions have certainly changed in the last six months" with an emphasis on keeping accounts current.
On that score, Wright-Patt, he said, had added mortgage education advice on its Web site and also started a new early-warning policy on 30-day collection notices. The notices encourage homebuyers facing problems to call or come into branches for help to avoid foreclosure.
"We just sent out 30 of the letters in one batch and we've already had eight members sign up," said Mislansky.
Wright-Patt is becoming more "pro-active" in the mortgage area in tracking individual calls and counseling members "who face those ugly ARMs," said Mislansky.
Meanwhile, the Ohio Credit Union League, which has been participating in a state-run Ohio Foreclosure Prevention Task Force, said more of its members have stepped up counseling programs and are setting up help lines for borrowers in difficulty.
Serving as a member of the task force set up by Democratic Gov. Ted Strickland is John Kozlowski, general counsel for the league.
In a report earlier this month, the panel issued 27 recommendations for lenders on everything from "intervention services" to providing borrowers help with refi options plus adding new homeowner protections.
The governor established the task force last spring to craft a coordinated statewide response to what was described as "a dramatic increase in the number of foreclosures in Ohio."
"Over the next two years," said the task force, "an estimated $14 billion of subprime adjustable rate mortgages will reset at much higher rates, impacting an estimated 200,000 Ohio borrowers."
The task force recommended loan servicers waive penalties and fees and reduce the principal when it is more than the property's current value.
In addition, "loan servicers should be required to notify borrowers six months before an adjustable rate mortgage is to be reset and that the governor advocate that Congress take action to provide income tax forgiveness on loan readjustments."