Attorney General Douglas F. Gansler and officials from the Department of Housing and Community Development on Thursday awarded $6.2 million from the national mortgage settlement to nine legal aid groups in order to expand the availability of low-cost and pro bono legal services to Maryland homeowners facing foreclosure.
Recently, DHCD has been setting aside about $1 milllion per year for foreclosure legal services, so the settlement funds greatly expand available financing, said Carol A. Gilbert, a DHCD assistant secretary.
The state will continue to contribute about $1 million per year over the next three years, the time frame for the distribution of the settlement funds, she said. The state estimates more than 12,500 homeowners will be assisted by the roughly $9 million in total funds over the three-year period.
Here's how the funds are being distributed: Maryland Legal Aid, $3.6 million; Civil Justice Inc., $1.4 million; Maryland Volunteer Lawyers Service, $930,000; St. Ambrose Housing Aid Center, $600,000; Pro Bono Resource Center of Maryland, $565,000; Public Justice Center, $510,000; Community Legal Services of Prince George's County, $850,000; Mid-Shore Pro Bono Inc., $342,000; and Allegany Law Foundation Inc., $200,000.
Maryland officials were given discretion over how to spend about $60 million from last year's national settlement with the nation's five largest mortgage servicers — Ally/GMAC, Bank of America/Countrywide, Citibank, JPMorgan Chase/WaMu and Wells Fargo/Wachovia. The settlement was negotiated by state attorneys general to resolve allegations that the servicers acted illegally and abusively in a rush to foreclose on homes.
The remainder of the $60 million in settlement funds is being used to tear down vacant homes in Baltimore, fund nonprofits' housing counseling programs and pay for additional state employees to work on housing issues. Recommendations are being finalized about how to allocate the $8.6 million for housing counseling programs, Gilbert said.