Arnie fights for homeowners

By Michael B. Marois  |   2008-11-7  |     NEWSPAPER EDITION

CALIFORNIA Governor Arnold Schwarzenegger proposed a 90-day stay on home foreclosures in California, one of the hardest hit states in the United States by the national housing-market collapse.

Schwarzenegger said he will ask lawmakers to consider delaying foreclosures when he orders them into a special session to deal with the state's ballooning budget deficit. The measure would exempt lenders if they can prove they have set up a program to help troubled homeowners modify their loans.

California, which leads the nation in foreclosures, is one of more than two dozen states that have taken steps to help distressed homeowners and to stem escalating defaults. Congress has been urging financial-services companies to work with borrowers and avoid foreclosures, which rose to the highest on record in the third quarter.

"The single most powerful action our state can take to shore up its economy is to help Californians stay in their homes ?? and I am presenting a plan to do just that," Schwarzenegger, a 61-year-old Republican, said in a statement. "Curtailing foreclosures will stop the downward spiral of home prices, free up cash for homeowners, help save jobs and make an immediate positive impact on our economy."

US foreclosure filings increased 71 percent in the third quarter from a year earlier to the highest on record as home prices fell and stricter mortgage standards made it harder for homeowners to sell or refinance, RealtyTrac, a provider of real estate data based in Irvine, California, said on October 23.

The number of California homes in foreclosure totaled 79,511 in the third quarter, said San Diego-based real estate research firm MDA DataQuick. That was more than triple the year-earlier number, and the highest since MDA DataQuick began tracking the data in 1988.