Bank Holding Off On Actions As State Foreclosures Soar

WATERBURY (AP) — Waterbury-based Webster Bank, which operates a Church Hill Road branch in Newtown, announced November 14 it will hold off on any home foreclosures for 90 days.

In addition to the moratorium on mortgage foreclosures, bank officials say Webster plans to expand mortgage assistance programs to keep families in their homes.

Webster officials say the bank temporarily will suspend foreclosure activity for at least 90 days for qualified homeowners who were more than 30-days delinquent on their mortgages as of November 4.

An executive in charge of mortgage lending for Webster says there are about 400 mortgages, worth $40 million to $60 million, that could qualify for the moratorium.

The assistance program is aimed at identifying and contacting at-risk customers to see if they need help remaining current with payments.

On the same day, Connecticut officials said a program created last year to refinance subprime mortgages for financially troubled homeowners is not helping as many people as expected.

The Connecticut Fair Alternative Mortgage Lending Initiative and Education Services, known as CT FAMLIES, will help 190 homeowners in its first year. State officials say that is a third fewer people than intended.

Governor M. Jodi Rell says the $50 million program has received 15,000 calls to date. She says the program has so far either approved or closed refinancing on $12 million in loans for 60 homeowners. Another 130 applications for nearly $27 million in loans are being processed.

California-based RealtyTrac.com, a website that tracks foreclosure trends nationally, said November 14 that its monthly report showed foreclosure activity increased in Connecticut by 136 percent between September and October. Nationally, foreclosure activity increased only 5.11 percent for the same period.

Compared to October 2007, Connecticut foreclosures increased more than 95 percent, according to the site.

Those 190 loans amount to 3.3 percent of the almost 5,700 potentially delinquent subprime loans in Connecticut.

Just because a notice or foreclosure action is taken does not mean the house will be lost. Of the 279,561 foreclosure actions taken nationally in October, banks took 84,868 properties, according to RealtyTrac. In Connecticut, banks took 520 of the more than 3,000 properties threatened with foreclosure.

New Haven County led Connecticut’s rise in foreclosures, with 896 filings in October, followed by Fairfield County, which had 768, according to RealtyTrac.

Connecticut’s numbers did fall after the start of state-sponsored programs to combat foreclosures. Until October, Connecticut had posted six straight months of foreclosure activity decline, compared to 2007. The nation is in its 34th straight month of increased activity, according to RealtyTrac.