No-Interest Loans, Florida Foreclosure Help: Months Away

Ever since the Jacksonville Housing Commission voted in March to create an anti-foreclosure program, the phone has been ringing at City Hall as Florida mortgage holders call for help.

The Jacksonville City Council approved creation of the program on May 22, which will provide no-interest loans of up to $5,000 a homeowner.

But it still will be several months before the loans are available. The earliest the program would be “up and running” will be in the fall, said Wight Greger, deputy director of the city Housing and Neighborhoods Department.

The Jacksonville housing market has ranked among the hardest-hit cities by foreclosures. In the first three months of 2007, Jacksonville’s foreclosure rate was the 15th highest in the nation, according to a RealtyTrac survey of major cities.

“It’s a huge problem that has long-term consequences for the community,” said Michael Figgins, executive director of Jacksonville Area Legal Aid.

Jacksonville Area Legal Aid, a nonprofit law firm, has been swamped with people seeking help to keep their homes. Since January, the firm has been able to open 26 new foreclosure cases but it has been forced to turn away 152 people because it lacks enough attorneys, Figgins said.

He said that based on the firm’s past success, he figures Jacksonville Area Legal Aid could have been successful in at least 90 percent of the cases that were turned away. Florida mortgage lenders often must make accommodations to homeowners, but the process is so complex that homeowners “run into a brick wall” if they don’t have a lawyer representing them, said Lynn Drysdale, an attorney for Jacksonville Area Legal Aid.

Jacksonville Area Legal Aid asked the Housing Commission to earmark $250,000 so the firm could hire more attorneys for foreclosure cases. But Greger said the budget is too tight for the city to use state housing grant dollars for that purpose. Figgins said he’s continuing to look for money “under every rock we can” at the city and state level.

Homeowners struggling to pay their Florida mortgage loans can turn to other nonprofit groups.

The United Way of Northeast Florida can refer people to organizations that provide emergency relief assistance. For instance, Catholic Charities provides up to $500 for people who face an unexpected hit on their household budget. Usually, the money helps people pay rent or get their lights turned on, but it also can help those struggling to pay their mortgage, said John Fitzgerald, director of emergency assistance.

The Housing Partnership of Northeast Florida has had a program since 2004 to help people Florida refinance their loans if they are victims of predatory lending. The nonprofit organization has aided seven homeowners by providing them more affordable home loans, and two other homeowners by providing money for them to ride out a short-term financial crunch.

The organization gets calls on a daily basis, but too often, homeowners are calling the same week they’re going to lose their home to foreclosure, said Jimmie Jones, vice president of lending services. He said owners should call their lender as soon as they think they won’t be able to make a mortgage payment and start talks on how to negotiate terms in which the individual can afford to keep the home.

He said the Housing Partnership of Northeast Florida would be interested in administering the city’s anti-foreclosure program. Greger said the city’s goal is to pool about $200,000 for the loans.

At a maximum loan amount of $5,000, that would be enough to help at least 40 homeowners who face a short-term financial crunch but can afford to pay off their Florida mortgage over the long run.