Judge considers use of mortgage settlement money
PHOENIX (AP) — While critics say the money should be used to help mortgage borrowers, a lawyer for the state said Wednesday that Arizona is entitled to use $50 million of its share of a multistate foreclosure settlement paid by lenders to help balance the state budget because it’s compensation for revenue lost due to the housing market collapse.
“Everyone who pays taxes in this state has been affected by this foreclosure crisis,” said Douglas Northrup, representing Attorney General Tom Horne. “It doesn’t have to be put aside for a narrow subset of people who were in danger of losing their homes …”
Tim Hogan, an attorney challenging the $50 million transfer to the general fund disagreed, saying that’s a legally shaky argument and that the money is intended for services and other uses directly related to mortgage foreclosures.
“Just sticking money in the general fund doesn’t improve or make better the foreclosure crisis,” he said. “You’re just spending money on state government.”