South Carolina High Court Temporarily Slams Brakes On Foreclosure Actions Statewide Involving Owner-Occupied Dwellings

In Columbia, South Carolina, The Greenville News reports:

• Thousands of homeowners facing foreclosure across South Carolina are getting a second chance after state Supreme Court Chief Justice Jean Toal ordered all foreclosures halted until after an intervention process can be completed.
• Toal's order is the second in two years on the issue and the result, she said, of breakdowns in the process. She said judges with jurisdiction over foreclosures have told the Supreme Court they're having trouble because of failed or delayed “mitigation efforts” between those making and servicing the loans and those owing the money. That, Toal said, has caused the number of unresolved foreclosure actions to increase.
• Sue Berkowitz, an attorney and director of the Appleseed Legal Justice Center, which assists low-income citizens with legal matters, hailed the order as a victory for the consumer. “The mortgage companies were not doing what they were supposed to be doing,” she said. “They were losing documents. They weren't going through the process in good faith. I think this is an excellent step forward. This is going to help consumers a lot.”

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• One problem, Berkowitz said, was that especially with large lenders, communication was poor, leading to situations where homeowners pleaded their case to the bank “and the next thing they know their house was up for sale because while they thought they were negotiating in good faith, the bank was going forward with the legal process.”

For more, see S.C. foreclosures put on hold (Chief justice wants intervention process finished to clear up problems) (subscription required; if no subscription, GO HERE, then click appropriate link for the story).

See also, The Post and Courier: Top court halts some foreclosures: Borrowers, lenders given more time to work out deal.

For Justice Toal's order, see Administrative Order re: Mortgage Foreclosure Actions.