Maryland residents facing foreclosure can begin taking advantage of a new law requiring mortgage lenders to prove they tried to modify a loan before forcing residents out of their homes.
The bill, which took effect Thursday, directs lenders to provide homeowners with all the information and paperwork necessary to contest lenders’ decisions before issuing a foreclosure notice.
Lenders must pay a $300 fee for every foreclosure notice issued and borrowers must pay $50 if they request mediation.
Loan analysts have said the bill would drive lenders out of the state, but Gov. Martin O’Malley’s spokesman, Shaun Adamec, said the measure targets only predatory lenders.
The Department of Housing and Community Development expects to collect nearly $11 million in fees from mortgage lenders in 2011 and $218,000 from homeowners under the new bill.
