Colorado’s plans for distributing $51 million in mortgage settlement money will help struggling homeowners stay in their homes, support affordable housing expansion, and will breathe new life into the small town of Fort Lyon with a center for homeless veterans.
There’s a lot to like about the ways in which the money from this national settlement will be divvied up.
The bulk of the money is intended to help homeowners buffeted by the housing downturn refinance or modify loans to avoid foreclosure.
Another emphasis is to stimulate construction of affordable rental housing, the goal being an additional 750 units.
The windfall is the result of a .
It’s important to keep in mind that this settlement addresses only one chapter in the housing crisis: abusive loan-servicing practices. Those include faked documents and robo-signing, a term coined to describe how bank employees systematically attested to the veracity of documents without verifying the information in them.
Colorado Attorney General John Suthers and First Assistant Attorney General Andy McCallin were intimately involved in the team that .
In all, , but it will come in myriad ways, including mortgage servicers moving to reduce principal or refinance loans currently held, and to directly compensate homeowners who suffered abusive foreclosure practices yet were going to lose their homes anyway because they were behind on payments.
The so-called “hard cash” portion of Colorado’s settlement — .
The money offers an opportunity to craft Colorado-focused solutions to difficult housing problems. In these times of fiscal austerity, the amount of money available is a rarity.
To Fort Lyon, it is a blessing. The small, a victim of budget cuts.
The settlement offers the town a lifeline. The plan is to repurpose the prison to provide housing, job training and substance abuse and mental health treatment for up to 400 military veterans.
Gov. John Hickenlooper’s administration hopes to leverage $5 million of mortgage settlement funds to get an additional $5 million in federal matching funds. Helping veterans reintegrate into society is a worthy cause, and we hope the plan pans out.
All told, the variety of ideas has the potential to stabilize neighborhoods still teetering from the .
With proper administration and oversight, this money is an opportunity to make a difference. We look forward to seeing its positive effects on difficult housing problems.
