Categories :: Homeownership > Foreclosure

A foreclosure is the legal means by which a lender can repossess your home. When this occurs you will be forced to leave your home. Foreclosures have increased in America over recent years, and they pose a particular threat to elderly, disabled, and poor citizens who become incapable of making their home payments.

In response to the housing crisis, the state and federal governments have responded with new laws, regulations and programs. These resources are for homeowners and do not cover renters. If you are a renter, see how foreclosure affects tenants.

Maryland Resources

A number of new laws and regulations were passed beginning in 2008. 

Statewide Resources

The Maryland HOPE Initiative (Maryland Home Owners Preserving Equity) is the state's main website for providing resources for homeowners needing help with mortgage foreclosures. A part of the Department of Housing and Community Development (DHCD), they can be reached at 1-877-462-7555, 8:00 a.m. – 8:00 p.m., 7 days a week.  The HOPE Hotline can connect homeowners with free housing counseling and legal services.

The Maryland Department of Labor, Licensing, & Regulation - This website provides general information on foreclosures and tips on avoiding foreclosure rescue scams.

Foreclosure Proceedings in Maryland - The Maryland State Bar Association (MSBA) is the professional association for lawyers in the state. They provide continuing legal education, information about the law, and initiatives to improve the legal system for the public. This brochure from MSBA’s Public Awareness Committee is a good resource on foreclosures in Maryland. Updated June 2008.

Emergency Assistance to Families with Children Program - This Maryland program provides financial assistance to families with children that may face an immediate crisis such as a foreclosure.

Legal Resources

Homeowners may be able to receive free or low cost legal representation through a number of legal services organizations.  With funding fromt the Department of Housing and Community Development and the Maryland Attorney General's Office, representation may include attending mediations with homeowners and assisting with lender negotiations.

Participating Legal Service Organizations -

Allegany Law - Intake: 301-722-3390 (Allegany)

Civil Justice - Intake: 410-706-5649

Community Legal Services - Intake: 240-391-6413 (Prince George's)

Maryland Legal Aid Bureau - Intake: 888-213-3320 (statewide)

Maryland Volunteer Lawyers Service - Intake: 443-451-4067 (Anne Arundel, Baltimore City, Baltimore County, Carroll, Cecil, Charles, Frederick, Garrett, Harford, Howard, Montgomery, Calvert, St. Mary's, Somerset, Washington, Wicomico)

Mid-Shore Pro Bono - Intake: 410-690-8128 (Caroline, Dorchester, Kent, Talbot, Queen Anne)

Public Justice Center - Intake: 410-625-9409 (tenant assistance only - statewide)

Pro Bono Resources Center of Maryland - Intake: 800-396-1274, ext. 3052

St. Ambrose Hosuing Aid Center - Intake: 410-366-8550 (Anne Arundel, Baltimore City, Baltimore County, Carroll, Cecil, Harford, Howard)

City and County Resources

Baltimore Homeownership Preservation Coalition provides a free Mortgage Matters workshop for homeowners in need of advice.  The workshop provides mortgage counselors and tips on avoiding foreclosure.

The Housing Authority of Baltimore City provides additional information in housing options.

Montgomery County Department of Housing and Community Affairs provides helpful tips on preventing foreclosures, educational seminars, and tips on avoiding scams.

Prince George's County Department of Social Services provides a Homelessness Prevention Program.  The program screens applicants for eligibility, counseling, and provides referrals.

Nonprofit Resources

Catholic Charities, Laurel Advocacy & Referral, and United Communities Against Poverty (UCAP) may offer emergency assistance to homeowners behind on their mortgage payments. 

Federal Resources

On the federal level, the Homeowners Hope Hotline has been established to connect distressed homeowners to free foreclosure counseling. Counselors all come from agencies certified by the Department of Housing and Urban Development (HUD). The Homeowners Hope Hotline is 1 (888) 995-HOPE. The Hotline was created by HOPE NOW, an alliance between HUD approved counseling agents, servicers, investors and other mortgage market participants.

In addition, the federal government announced new programs to aid homeowners in both 2008 and 2009. In October 2008 the Hope for Homeowners program was passed as a part of the Housing and Economic Recovery Act of 2008. Hope for Homeowners provides new 30-year fixed rate Federal Housing Administration (FHA) mortgage loans to homeowners who cannot afford their current loans. The homeowner must have a mortgage debt to income ratio greater than 31% as of March 1, 2008. Homeowners must also have made a minimum of six full payments on their existing first mortgage and did not intentionally miss mortgage payments.

Lenders must agree to participation in the Hope for Homeowners program. FHA maintains a list of participating lenders. Contact the FHA Resource Center at 1-800-225-5342 for more information.

In March 2009, the Making Home Affordable Program was announced. The Program includes a modification option and a refinance option. The modification option assists homeowners who cannot afford their current mortgage in modifying their mortgages to a monthly payment they can afford. Under this option, the US Treasury contributed $75 billion to provide money to mortgage servicers to modify loans for homeowners whose mortgage payments are more than 31% of their monthly income. To qualify, the homeowner must have an unpaid balance that is equal to or less than $729,750, on a loan that was taken out on or before January 1, 2009. 

The refinance option of the Making Home Affordable Program allows homeowners who are current on their mortgage to refinance and get a lower monthly payment. The original mortgage must be owned or been placed in a mortgage backed security by one of the government sponsored corporations Fannie Mae or Freddie Mac. Homeowners are allowed to refinance as long as what is owed is less than 105% of the property's value. Loans do not have to be owned by Fannie Mae or Freddie Mac for the modification option. Fannie Mae and Freddie Mac have telephone numbers and web pages to help homeowners figure out if a loan qualifies.

Fannie Mae, or the Federal National Mortgage Association, was created in 1938 as a government entity to help lenders provide mortgage financing to home buyers at reasonable rates. Fannie Mae was chartered as a government-sponsored private organization in 1968.

Freddie Mac, or the Federal Home Mortgage Corporation, was created by by congress in 1970 to be a competitor for Fannie Mae. Freddie Mac primarily purchases mortgages from primary lenders so that banks have money to lend to others. Freddie Mac maintains a page on avoiding foreclosure.

Additional Federal Resources

The HUD website provides several tips on avoiding foreclosure, financial education for homeowners, and refinancing information. HUD also provides help to veterans through the Servicemembers Civil Relief Act of 2003.  The Act provides mortgage relief, termination of leases, protection from eviction, a six percent cap on interest rates, stay of foreclosure proceedings, and reopening of Default Judgments.  

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Is this legal advice?

This site offers legal information, not legal advice.  We make every effort to ensure the accuracy of the information and to clearly explain your options.  However we do not provide legal advice - the application of the law to your individual circumstances. For legal advice, you should consult an attorney.  The Maryland State Law Library, a court-related agency of the Maryland Judiciary, sponsors this site.  In the absence of file-specific attribution or copyright, the Maryland State Law Library may hold the copyright to parts of this website. You are free to copy the information for your own use or for other non-commercial purposes with the following language “Source: Maryland's People’s Law Library – © Maryland State Law Library, 2017.”

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