PROVIDENCE, R.I. (Legal Newsline) - Rhode Island Attorney General Peter Kilmartin announced Thursday that the Rhode Island Legal Services has been awarded a two-year, $1.57 million grant to support the state's Foreclosure Prevention Project.
According to Kilmartin's office, the project grant will be funded through the nationwide mortgage settlement.
The $25 billion deal was reached in February between federal officials, 49 state attorneys general and five of the nation's largest mortgage servicers -- Wells Fargo and Co., JPMorgan Chase and Co., Citigroup Inc., Ally Financial Inc. and Bank of America Corp.
The settlement only covers those mortgages held by the five banks, not Fannie Mae or Freddie Mac.
Under the terms of the nationwide settlement, Rhode Island received a direct payment of $8.9 million to help fund consumer protection and state foreclosure protection services.
Kilmartin said, with the grant, the state's Legal Services will help stop, prevent or delay the foreclosure of nearly 2,000 homes each year.
RILS will assist homeowners facing foreclosure in bankruptcy court, provide housing and foreclosure prevention counseling, negotiate directly with lenders on loan modifications and principal reductions, and file lawsuits against predatory lenders, he said.
"Many Rhode Islanders facing foreclosure cannot afford to hire a private attorney to advocate for them against the mortgage service providers or represent them in legal proceedings," the attorney general said in a statement.
"Rhode Island Legal Services has a long tradition and an excellent reputation for providing effective legal assistance and representation for those less fortunate."
Kilmartin continued, "The Foreclosure Prevention Project will enable RILS to add the staff resources needed to refocus efforts on this critical legal problem confronting many homeowners."
In particular, RILS will help with pre- and post-foreclosure litigation, loan modification, post-Home Affordable Modification Program (HAMP) enforcement and major impact litigation, including bankruptcy, when appropriate.
"This is a wonderful opportunity to assist distressed homeowners facing foreclosure and to provide them with the legal assistance necessary to prevent the loss of their home and the myriad of other problems that accompany every foreclosure," RILS executive director Robert M. Barge said Thursday.
"RILS has the unique ability to reach those communities most affected by the foreclosure crisis and we look forward to working with housing counselors, community organizations and other agencies that are working to mitigate the foreclosure crisis."
Kilmartin said more grants funded through the nationwide settlement are expected to be announced in the coming weeks.
From Legal Newsline: Reach Jessica Karmasek by email at email@example.com.