The nationwide foreclosure crisis has roots reaching back five or 10 years, and remains a troubling phenomenon well into 2009, Illinois Attorney General Lisa Madigan said Friday.
Madigan, speaking at the Black Road Branch of the Joliet Public Library, urged people to contact her office for help if they know of people struggling with their mortgage.
“Please let them know there’s free, legitimate help available,” Madigan said. You can email Madigan’s office at www.illinoisattorneygeneral.gov for more information.
“Particularly here in Will County, there’s no more important thing for me to be talking about than the foreclosure crisis, and the impact that it is having on hundreds of thousands of people in Illinois,” she said.
Madigan spoke of a recent trip to Washington, where the House Financial Services Committee had a hearing about what state and federal regulators have been doing to contend with the foreclosure crisis.
“There was this whole panel of federal regulators — folks from the Treasury and the (Securities and Exchange Commission) and everywhere — and they all sat there and made their presentations,” she said. “Let’s be honest: They weren’t doing anything for the past five or 10 years on this issue. They’ve been doing nothing.
“When our panel, the state panel, got up to testify, I sat down and said … ‘Let’s debunk a myth here. This didn’t just start happening a year or two ago. This has been going on … for five, 10 years, when these predatory practices and these lax underwriting standards were being adopted by far too many lenders and brokers.’”
She said a key financial principle had “evaporated.”
“Instead of a bank holding onto a mortgage and therefore being concerned about whether or not the family could actually make their mortgage payment — that evaporated,” she said. “Then you no longer had any need or incentive on behalf of the lender or the broker to be concerned about that family’s ability to pay.”
“And that’s what’s really at the heart of this whole economic crisis that has plunged our national economy into this terrible situation,” she said.
Madigan said the nation has a record number of foreclosures, with 2.3 million people last year having a foreclosure filing on their home, including almost 100,000 people in Illinois.
“Those numbers this year are exploding. They are even worse than last year,” Madigan said. “And so at this point, there’s really not necessarily an end in sight.”
“What we were seeing this past year was largely because of bad loans that shouldn’t have been made or people were put into irresponsibly,” she said. “Now we’re seeing people losing their homes because they lost their jobs and they just don’t have an income. So all of this is terribly tied together.”
If you or anyone else you know is facing foreclosure, contact Attorney General Madigan, or contact us. Leave a question in the comment area, along with your email address, and we’ll be happy to answer your question.
