Albany Government Law Review

As the wave of foreclosures started to hit the early states of Florida, Nevada and California,there was wide-spread confusion. Borrowers did not know whom to call to work out their problems; their loans had been transferred so many times, they lost track of whom to contact. Servicers, lenders, and investors were arguing about the modification powers permissible in this environment. The national government kept refusing to intervene, despite the fact that most actors involved were governed by the Securities and Exchange Commission (SEC) or banking regulators. State governors and regulators scrambled to find any tools to reach the relevant actors. And mayors across the country began to take notice, realizing that the fallout from all of this would be felt most by residents in their neighborhoods.