As the nationwide economic recession and mortgage crisis persist, more and more homeowners and families continue to face the sad reality of foreclosure and are being forced out of their homes. Foreclosure is incredibly disruptive to families’ lives and can be further devastating because of the sense of shame and failure often associated with losing one's home. It is critical that we take steps now to help more people remain in their homes and to keep our communities intact.
On November 21, 2009, the Assembly passed legislation I supported that will protect homeowners facing foreclosure, as well as tenants living in buildings being foreclosed (A.40007).
Midway through 2009, New York ranked 39th in the nation in foreclosures, indicating that the Empire State is far from being in the most perilous position when it comes to the nationwide mortgage crisis. Still, some areas of the state have been hit disproportionately hard.
I shall not stand by as hardworking people lose their homes and life-savings and are forced onto the street. As long as families are being edged out of their homes due to foreclosure, New York needs to do better and put more effective measures in place to assure that homeowners’ and tenants’ rights are protected.
In order to do this, the Assembly’s reform measures expand consumer protections to all distressed homeowners, beyond those with sub-prime or non-traditional mortgages. All struggling homeowners would be able to participate in pre-foreclosure settlement conferences and would be required to receive a notice from lenders ninety days before legal action is commenced. The legislation also establishes a data-collection program to help the state identify distressed homeowners and target counseling to them.
The Assembly reform measure also:
- authorizes and regulates “shared appreciation” agreements between lenders and borrowers;
- ensures a speedy settlement conference process;
- expands notice to co-op owners subject to default, thereby enabling them to take advantage of counseling and attorneys;
- grants tenants the right to remain in foreclosed-upon properties until the end of the lease -if the tenant has a lease – and for 90 days in the absence of a lease; and
- requires that owners of foreclosed properties maintain their properties and keep them safe and habitable.
Vacant properties that are not maintained increase fire hazards, facilitate criminal activity and depress surrounding property values.
Enacting these mortgage-reform measures is critical to protecting homeowners’ and tenants’ rights, keeping people in their homes preserving the fabric of our communities.