Issue date: 7/24/08 Section: City

When homeowners miss three months' worth of mortgage payments, they receive notices of foreclosure, which means the lending bank will reposess their properties if they cannot bring their loan payments up to date. Most foreclosures in Evanston are in the 5th and 8th wards, areas with high numbers of minorities and elderly people, Brewer said. These groups are especially vulnerable to predatory lending, according to a 2005 University of North Carolina study.

On July 1, Senate Bill 1167 went into effect, which regulates mortgage brokers and mandates housing counseling for certain homebuyers. For example, first-time buyers and anyone refinancing an existing mortgage must undergo counseling before closing on an adjustable-rate or interest-only mortgage, loans that are usually more difficult to pay back. SB 1167 joins recent national efforts to quell the foreclosure crisis. The Federal Reserve unveiled a new set of rules regulating abusive mortgage practices on July 14, although the regulations will not go into effect until October 1, 2009.

There are only two licensed counseling centers in the North Shore, Interfaith and Ceda Neighbors at Work. The demands of SB 1167 and the rising foreclosures have kept them busy. Interfaith recently applied for more funding from the US Department of Housing and Urban Development and hired another staff member. For the first time, one Interfaith employee works exclusively with foreclosures.

Slowly, Evanston officials are coming up with a plan to combat foreclosures. Alderman Lionel Jean-Baptiste (2nd) mentioned the problem at the last City Council meeting, and said he wants to start a public awareness campaign to educate homeowners about foreclosure. Many residents, especially the elderly, may not understand the foreclosure process or know about the resources available to avoid it, he said. Two of Jean-Baptiste's neighbors have been forced out of their homes by foreclosure, he said.

"Let's begin to provide more assistance to victims so they know they can go to someone immediately," he said.

Continued...

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