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  • In Alabama, during financially difficult times , it has come as a help to balance the budget that there has been a national settlement of $25 billion with five big mortgage companies .The settlement may even be instrumental in helping low income families to become home owners.

    $25·3million from the settlement is to go to the office of Alabama Attorney General Luther Strange. This money does not come in a lump sum but is slowly being received in the office and $19·3 million from the total is to be used during the years 2013 through 2015 to fund the attorney general`s office and the district attorneys `offices throughout the state. According to Arthur Orr, R-Decatur (Senate budget committee Chairman) this will mean that money that would have had to be used by these offices from the state General Fund budget can now be released to support other programs. The amount of the settlement when compared with the $1·68 billion of the state`s General Fund budget for the fiscal year starting Oct.1, may seem small he said,” but that helped the overall budget picture”.

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    State officials are being approached by two advocacy groups for the poor of Alabama, they are The Arise Citizens` Policy Project and the Low Income Housing Coalition of Alabama, who want the remaining $6 million to be used to give housing to those in need. Jim Cames who is the spokesman for Arise Citizens said that when the Legislature voted last month to set up the Housing Trust Fund it opened up the way to providing affordable housing for low income residents but was unable at that time to put any money into it due to the state`s budget problems. Now that there is mortgage settlement money available it could be that the project can be started off.

    Joy Patterson, the attorney general`s spokeswoman, says that the attorney general would be happy to look into the suggestion although no decision has been made yet as to how the money will be used.

    The $25 billion agreement in February was reached by the federal government along with 49 state attorneys general including Alabama`s attorney general Strange. The five large mortgage companies were accused of improper handling of mortgages including employees signing foreclosure paperwork without reading it. They were Ally (formerly GMAC), Bank of America Corp., Citi, J .P .Morgan Chase & Co., as well as Wells Fargo & Co.

    The total estimated share for Alabama is $106 million and in addition to the amount to be provided to the attorney general`s office Alabama`s borrowers are expected to receive nearly $30 million for loan term changes and other help. Those borrowers who lost their homes due to foreclosures between 2008 and 2011 and who suffered servicing abuse are expecting $20million in payments while those borrowers who`s mortgages are under water are to have refinanced loans said to be worth almost $30 million.

    The amount to be received by the attorney general`s office may be used to help the people who have been hurt most by the nation`s housing crisis.

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