RICHMOND, Va. (WTVR) – Virginia is cashing in on a landmark federal-state mortgage settlement. Five of the nation’s largest mortgage service companies paid Virginia close to $480 million as part of the settlement. Most of the money will be funneled to help Virginia homeowners who faced foreclosure.
But close to $70 million will not go to homeowners. That money will go directly to the Commonwealth. It is a turn of events that has frustrated some homeowners.
Kristen Hurtado is disappointed the state will not spend all the money to help homeowners. She recently shared her story with CBS 6. She said she was being wrongfully foreclosed upon while working out a loan modification with her bank.
“I want to prevent this from happening to other people. Let’s help with the prevention of homelessness Let’s help them with more affordable housing for people like me and others who find themselves in similar situations,” said Hurtado.
State lawmakers have indicated they planned to use the Commonwealth’s $69 million on things like bonuses for state employees and to help local governments cover budget shortfalls.
“Many of them have the unusual problem of having to make up for VRS payments. We want to make sure we help shield local governments from those types of costs,” said Senator Walter Stosch (R – Glen Allen).
Advocacy organizations like Housing Opportunities Made Equal (HOME) have said all of the money should be invested in housing issues. They want lawmakers to use the money on things like down payment assistance for first time home buyers, revitalizing vacant and abandoned homes, even foreclosure prevention counseling.
But Sen. Stosch said it’s important for people to realize the $69 million came to the Commonwealth without any strings attached.
He said the state is spending the money in the best possible way.
“I think it’s important that they know that housing and homelessness efforts to us are ongoing obligations and I would prefer to see us address those things in the budget each year, not just one time with this settlement,” added Sen. Stosch.
