npr.org
Zombie Mortgages: State Action and Widespread Concerns
Massachusetts cracks down on "zombie" second mortgages, impacting hundreds of homeowners, but the problem remains widespread.
English
United States
Us PoliticsFinanceLawsuitDebtConsumerForeclosure
Massachusetts Attorney General's OfficeFranklin Credit ManagementNational Consumer Law CenterConsumer Financial Protection BureauNpr
Andrea CampbellChris ArnoldAndrea Bopp StarkRohit Chopra
- What is the main issue addressed in this news report?
- Massachusetts Attorney General Andrea Campbell's office investigated Franklin Credit Management for allegedly violating state and federal law by trying to collect on "zombie second mortgages"—loans homeowners thought were resolved but are now being pursued.
- What is the significance of the Massachusetts settlement for other states?
- Andrea Bopp Stark, an attorney with the National Consumer Law Center, believes the Massachusetts settlement provides a roadmap for other states to take action against companies engaging in similar practices with zombie second mortgages.
- How many homeowners in Massachusetts are directly helped by the settlement?
- Approximately 518 borrowers in Massachusetts are being helped by the settlement with Franklin Credit Management, which agreed to cease collection efforts on its entire portfolio of Massachusetts mortgages and change future business practices.
- What is the broader scope of the zombie mortgage problem beyond Massachusetts?
- A recent NPR investigation found at least 10,000 zombie second mortgages with foreclosure activity across several states, highlighting the widespread nature of the problem and the need for broader action.
- What is the role and perspective of the Consumer Financial Protection Bureau on this issue?
- Rohit Chopra, director of the Consumer Financial Protection Bureau, acknowledges the problem of zombie loans and the potential for older, invalid debt to threaten homeowners' financial lives. He suggests that clearer rules and regulations could help.