ING Direct suspends evictions for the holidays

In an effort to help struggling homeowners have a happier holiday season, ING Direct has suspended evictions from single family homes through Jan. 15.

The company is also halting foreclosure sales through the end of March to give troubled borrowers a chance to get their finances in order and catch up on their payments.

“We hope this foreclosure suspension will provide some relief during the holidays to those experiencing financial hardships,” CEO Arkadi Kuhlmann said in a statement.

The suspensions could make a world of difference to about 250 of ING’s customers with seriously delinquent mortgages, among 1,300 borrowers who are 90 days past due.

Mortgage giants Fannie Mae and Freddie Mac also recently announced a temporary hold on foreclosures and evictions during the holidays, but elsewhere, borrowers are not so lucky.

Foreclosure rates rise

Delaware’s foreclosure rate has continued to climb, increasing another 14 percent between October and November, according to Realty Trac, a for-profit foreclosure research firm.

There were 176 foreclosure filings in New Castle County in November, the firm reported, and one out of every 1,199 homes in the county is in foreclosure.

While many borrowers are still struggling to make payments on their adjustable rate mortgages, there is a new factor driving up the foreclosure rate: job loss.

New Castle County’s unemployment rate climbed from 4.9 percent in September to 5.2 percent in October, slightly lower than the statewide rate of 5.4 percent and well below the national rate of 6.5 percent, according to the Department of Labor.

Those percentages are being felt at home as more and more desperate borrowers who seek help at the Hockessin Community Center are recently unemployed, said Roslyn Smith, a housing counselor.

The center’s phone has been ringing off the hook for months and there are already dozens of borrowers waiting in the wings for a mortgage refinance, she said.

Many are stuck in a vicious cycle, unable to get a refinance until they get a new job, she said.

“Until they get substantial income, there is nothing we can do,” she said.

And as if the housing market wasn’t bad enough, more and more business owners are visiting the center, she said, in danger of losing their homes after their small businesses went under.

The holidays are a terrible time to be facing foreclosure, she said, but for many desperate borrowers, the only option is to wait and see if help becomes available.

One issue exacerbating the foreclosure crisis is the lack of new financial assistance programs available from state governments already strapped for cash, said Robert Glen, Delaware state bank commissioner.

Scams draw in desperate homeowners

And homeowners who don’t know where to turn for help could easily fall into a foreclosure scam, Glen said. While not a huge problem in Delaware, scammers ask homeowners for a sum of money upfront to help refinance their debt, then never deliver on their promises, he said.

Reputable assistance services will not ask for a sum of cash upfront, he said, and there are many nonprofit groups in Delaware who will help homeowners facing foreclosure.

The foreclosure crisis will improve, Glen said, but he does not expect the housing market to recuperate anytime soon.

Housing prices are falling, making it more difficult for borrowers to get credit and refinance their mortgages, which is another factor that has played a role in the rising foreclosure rates, he said.

The median sale price of a home in New Castle County actually rose from $222,000 in September to $226,000 in October, but that price is still 3 percent less than the $232,750 average last October, according to Prudential Fox & Roach Realtors.

However, even as the credit situation continues to tighten, there is a silver lining, Glen said.

“Housing is going to be more affordable in the future, but obviously the process to get that correction was a painful one,” he said.