April 3, 2012

LePage veto of foreclosure bill upheld

BY GLENN ADAMS, Associated Press

AUGUSTA -- Lawmakers failed to muster enough votes Monday to revive a bill intended to address mortgage foreclosures in Maine -- a measure that Democrats said would protect consumers from losing their homes to large mortgage companies that may not legally own them, but Republican Gov. Paul LePage said would create red tape for businesses.

Representatives' 69-69 vote failed to draw the two-thirds majority needed to override LePage's veto of the bill on Friday. In a message to lawmakers, LePage said the bill failed to measure up to its title, "An Act to Clarify and Streamline Foreclosure Proceedings."

"If the title of this bill had matched the substance, then I would have happily signed it," LePage wrote.

The bill went before Maine lawmakers amid the national mortgage crisis, which has been marked by alleged foreclosure abuses such as bank employees signing papers they hadn't read or using fake signatures to speed foreclosures. Banks have been charged with using false and misleading information to support their foreclosures.

In Maine, Rep. Bobbi Beavers' bill would have required banks to present the original mortgage note or proof of ownership before court proceedings, preventing potential fraud against homeowners.

"Telling the truth should not be a burden," said Beavers, D-South Berwick.

LePage said Beavers' bill sought to add safeguards that are already in place under Maine law. He also warned that the bill might well have lengthened the foreclosure process in Maine, which now stands at about 420 days per case, one of the longest in the nation. By comparison, the process takes about 120 days in neighboring New Hampshire, he said.

By creating additional paperwork through the bill, the foreclosure process could be lengthened even more.

"We must keep in mind that every unnecessary delay in the foreclosure process will distort prices in our housing market," LePage wrote.

The governor also said the bill adds excess paperwork, or "red tape," to the process. Since taking office last year, LePage has sought every opportunity to snip what he sees as unnecessary regulation and red tape.

The Maine Bankers Association sided with LePage on the bill, saying higher administrative costs to lenders would be added to future mortgage loan interest rates.


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