Local Banks Offer Aid to Overwhelmed Florida Mortgage Borrowers

Miramar city officials have asked local banks to hold seminars for residents about Florida mortgage practices and to bankroll an emergency fund for such owners.

”We have families in the city who may be in over their heads,” said City Commissioner Troy Samuels, who is spearheading the initiative. “We need to help our families, educate them and help protect them.”

In the first three months of 2006, the city had nine foreclosure filings. Compare that to the same period this year, where there were 43 mortgage defaults.

Miramar, which has 24,330 owner-occupied homes, including town houses and condos, is looking to mirror programs in Louisville, Ky., San Antonio and the Phoenix housing market that offer financial help and mortgage education.

Officials are worried that communities will suffer as foreclosures rise: Property values fall, people move from the neighborhood, and foreclosed homes remain vacant for months, which encourages vandalism.

The Domino Effect…
”It’s a domino effect of negativity,” said Michael Wallace, a senior legislative counsel at the National League of Cities, which is fighting for home mortgage industry regulations.

Roughly half of owners of new homes in Miramar hold adjustable-rate mortgages, many of which will reset soon with higher mortgage interest rates, increasing monthly payments, said City Manager Bob Payton.

”It’s alarming,” Payton said. “These are hard-working people, and they have secure jobs. They just got locked up in a mortgage that’s not best suited for them.”

Samuels said he has spoken to Eastern Financial Florida Credit Union, Tropical Financial Credit Union and RBC Centura Bank about working with the city to help stave off foreclosures.

”We told him we would be interested in learning more about it and may be potentially supporting it,” said Mark Holmes, spokesman for Eastern Financial.

Strings Attached…
Miramar has $60,000 in state money to assist some homeowners who cannot afford to pay their Florida mortgage loans.

But that program comes with income restrictions that disqualify many homeowners in the city, where the average home value is $451,915 for single-family homes and $246,000 for condos.

”A large group of people who are being impacted in this market are middle and upper middle class,” said Gus Zambrano, Miramar’s economic development and revitalization director.

Since the mid-’90s, 9,839 homes have been built west of Interstate 75, helping to make Miramar one of the fastest-growing cities in the nation, according to the U.S. Census Bureau. Those expensive new homes lured many buyers using unconventional mortgages.

For example: flight attendant Joann Soufisiavash bought a sprawling Miramar home for $459,900 almost two years ago using 100 percent financing and two mortgages.

Now, she can’t afford the $2,800 payment (not including taxes and homeowner’s insurance), and her home in a gated community is in the process of foreclosure.

She owes $502,000 on it. It has been appraised at $439,000.

”My American dream turned into a nightmare,” said Soufisiavash, 46. “I don’t know how this is going to end up.”

SOURCE: The Miami Herald