Before the housing meltdown, Maryland’s foreclosure process was so quick that it was nicknamed “the rocket docket.”
Foreclosures had to be filed in local courts and approved by judges, but the court’s involvement was so minimal and the deadlines so swift that a lender could schedule a foreclosure sale 15 days after the borrower defaulted.
In 2007, as thousands of Marylanders began losing their homes at an alarming pace, Gov. Martin O’Malley (D) vowed to end what he called the “fast track to foreclosure.”
Starting in 2008, state lawmakers passed a series of measures designed to give homeowners — some the victims of predatory lending, others hurt by the recession — more time to find a way to stay in their homes. The changes included forcing lenders to wait longer to file foreclosures, giving homeowners more access to housing counseling, and requiring lenders to participate in mediation.
Each change forced banks, loan servicers and the courts to adjust the way they do business, adding long delays to the foreclosure process. And last year, major lenders voluntarily halted foreclosures nationwide over concerns about“robosigning,” in which employees at firms hired to process foreclosure documents routinely signed them without reading them.
The result: Maryland has gone from having one of the country’s fastest foreclosure systems to having one of the slowest.
Foreclosure activity in the Free State fell by 16 percent in the three months after the 2008 changes took effect and by 58 percent in the three months after a mediation law took effect in 2010, according to a state report. But sales activity and prices fell as well. –– https://www.washingtonpost.com/local/maryland-vs-virginia-two-different-approaches-to-foreclosure/2012/03/02/gIQAD5hBpR_story.html?utm_term=.6b9c26c11b9e
Now, Maryland Governor Larry Hogan signed a fast-track foreclosure law which would expedite the foreclosure process with the intent to reduce community blight, following the footsteps of a similar bill in Ohio.
This bill could be the push other states need to move forward with their own fast track foreclosure bills.
“It’s very significant,” said Klein. “Both the Ohio bill and the Maryland bill passed unanimously, not many bills pass unanimously. This bill was debated quite a bit by the Maryland legislators, and they all came to the conclusion that having a property vacant and abandoned for two years is the wrong thing for community blight. So now we’re seeing a number other states looking at it closely and considering it, like New York, Illinois and Pennsylvania.”