Wisconsin Gov. Scott Walker plans to use foreclosure settlement money to balance budget

Yesterday 49 states agreed to take place in the $25 billion dollar foreclosure settlement from the country’s five largest banks.

Individual states will be awarded funds to assist troubled homeowners who cannot afford foreclosure attorneys. But Wisconsin Governor Scott Walker has stated that the funds distributed to his state will not be used for foreclosure relief programs. Instead he will use the $25.6 million of the $31 million awarded to the state to bridge the gap in budget shortfalls.

“Just like communities and individuals have been affected, the foreclosure crisis has had an effect on the state of Wisconsin, in terms of unemployment… This will offset the damage done to the state of Wisconsin,” Walker said, according to Think Progress.

State Attorney General J.B Hollen, who has the legal authority over the money, consulted with Walker to make this decision.

After a year of negotiations this settlement was achieved to help homeowners facing foreclosure or who are underwater, owing more than their homes are worth.

This move will likely stir up more ire from Walker’s critics, who launched a recall effort against the Conservative Governor.

Some homeowners have retained foreclosure lawyers to help them keep their homes, but there are many who need the assistance provided by state foreclosure relief programs. The settlement will only help 1 million of the 11 million people facing foreclosure. The homeowners not eligible for help from the settlement may be able to avoid eviction when they hire a foreclosure attorney.