New York City lenders foreclosed on more than 250 homes last month, down from October. But experts are attributing the drop to Albany’s 90-day foreclosure freeze.
Now that the market has thawed, a flood of failed mortgages could drown the city and the Bronx, where foreclosures actually increased in November – according to www.proper
Senator Jeffrey Klein released a report December 4 ranking the metro-area’s most threatening banks. US Bank topped the rankings, engaging in 275 foreclosure filings citywide between October and November. Deutsche Bank, Wells Fargo, HSBC, Bank of America, JP Morgan Chase, Bank of New York, Indymac, Citigroup and Capital One rounded out Klein’s top ten.
According to the report, Queens suffered 1,291 foreclosures, the Bronx just 214.
Klein has nicknamed the banks “Sub-prime Scrooges,” alluding to the risky loans that triggered Wall Street’s collapse and to the holiday season.
In September, Congress passed a $700 billion bailout package, relieving major banks of bad credit. But legislators in Washington D.C. and upstate have done little to keep people in their homes, Klein contends. The Sub-prime Scrooges are still filing foreclosures.
“This is socialism for the banks and capitalism for everyone else,” Klein said. “We need to refocus the banks on loan modification and make the state a stakeholder.”
In 2008, the State Senate partnered with the State Banking Department on Operation Protect Your Home, bringing distressed homeowners and lenders together.
Three months ago, Governor David Patterson signed a bill requiring banks to meet borrowers within 60 days of any foreclosure filing on a sub-prime mortgage. Klein, the senate’s former deputy minority leader, will ask Albany to include all residential mortgages next year.
Klein has also proposed that the state’s mortgage agency refinance troubled borrowers into 30-year fixed rate mortgages. Currently, the agency offers financing only to first-time homeowners.
Klein, now a candidate for senate majority leader and president pro tempore, supports the Neighborhood Preservation Act, a measure designed to enforce safety and habitability requirements for foreclosed properties.
“The Bronx, like other areas in the city, has seen a drop in property values as foreclosures increase and whole neighborhoods change character,” Klein said.
Last year, the Bronx saw 1,706 foreclosure filings – 553 in Williamsbridge/Baychester and 316 in Parkchester/Soundview, according to a New York University report.
Fremont Investment & Loan was the most-implicated originator of faulty mortgages and Deutsche Bank the number one Bronx forecloser.
US Bank will eventually receive $6,599,000,000 in federal funds. Teri Charest, a US Bank spokesperson, defended the company. US Bank serves as a trustee for investors purchasing mortgage-backed securities, Charest said, not a forecloser.
John McDermott, assistant chairman at the Consortium for Worker Education, tells anxious homeowners to ask non-profit mortgage counselors for assistance. McDermott has witnessed an up-tick in disreputable attorneys peddling bogus advice.
“Don’t put your head in the sand,” he said. “There are non-profits in the city, like us and ACORN, helping people approach banks to renegotiate.”
McDermott expects more Bronx foreclosures soon, as mortgages on the borough’s community-built townhouses mature.
©2008 Community News Group