Foreclosure crisis endures, but efforts to help borrowers are out of cash, advocates warn
ALBANY— Lawmakers say plans to ax the $25 million Foreclosure Prevention Services program would hurt beleaguered homeowners and compound problems of neighborhood blight.
"The foreclosure crisis is far from over," Sen. Jeff Klein, D- Bronx, Westchester said. He and fellow members of the Independent Democratic Conference joined other Senate and Assembly Democrats on Tuesday in calling for a re-start to the program's funding.
Last year's budget had no money for the program either, but because it ran on a two-year funding cycle, many of the dozens of non-profit groups that provide homeowner assistance are just now running toward the end of their state contracts. The program started under Gov. David Paterson.
Several of those who attended Tuesday's news conference said they would urge Gov. Andrew Cuomo to put funding for the program in his 30-day amendments to the 2012-13 budget plan which is due out later this month. Or they hoped it could get back in the budget during negotiations with lawmakers.
Under the program, groups such as local Legal Aid societies , the Affordable Housing Partnership of the Capital Region, Empire Justice Center and NYC's Habitat for Humanity employed counselors and advisers for people who had fallen behind on their mortgages, property tax payments or both and were in danger of foreclosure.
Advisers would help people work out lower payment schedules with lenders or even arrange to "short sell" a home at a loss rather than going into foreclosure, said Stephanie Galvin of the Albany County Rural Housing Alliance.
While New York so far has escaped the tidal wave of outright foreclosures that have hit Sun Belt states like Florida and Nevada, thousands of residents are barely hanging on to their homes. Falling behind on taxes and mortgage payments are signs that eventual foreclosure looms in the future.
In Albany County alone, nearly 4,000 dwellings are in foreclosure or are more than 60 days behind in their payments, advocates said.
In some cases, people simply walk away from their homes when they fall behind, assuming the bank will take it. But experts said banks don't really want abandoned homes and the dwellings can fall into a state of limbo that can blight a neighborhood.
Eliminating the assistance program comes as Cuomo's Financial Services Superintendent Benjamin Lawsky is launching a new unit that, like the $25 million program, aims to help homeowners facing foreclosure.
But Lawsky has said there is little money to go with that program.
"They don't have that much money to run that unit," said Susan Cotner of the Affordable Housing Partnership, a Capital Region organization that works on housing issues.
But Vito Lopez, the Brooklyn Democrat who chairs the Assembly Housing Committee, warned that advocates would be competing with a galaxy of groups and interests, all jockeying for money as lawmakers and the governor have to close a $2 billion deficit.
"You people have to get out there," he said, explaining that advocates need to make themselves heard and visible, especially since Cuomo is getting thousands of phone calls from people and groups seeking money in the state budget.
"How do you get across the finish line? That's the challenge," he said, adding "I have seven meetings (on Tuesday) about people that need money."
rkarlin@timesunion.com • 518-454-5758
"The foreclosure crisis is far from over," Sen. Jeff Klein, D- Bronx, Westchester said. He and fellow members of the Independent Democratic Conference joined other Senate and Assembly Democrats on Tuesday in calling for a re-start to the program's funding.
Last year's budget had no money for the program either, but because it ran on a two-year funding cycle, many of the dozens of non-profit groups that provide homeowner assistance are just now running toward the end of their state contracts. The program started under Gov. David Paterson.
Several of those who attended Tuesday's news conference said they would urge Gov. Andrew Cuomo to put funding for the program in his 30-day amendments to the 2012-13 budget plan which is due out later this month. Or they hoped it could get back in the budget during negotiations with lawmakers.
Under the program, groups such as local Legal Aid societies , the Affordable Housing Partnership of the Capital Region, Empire Justice Center and NYC's Habitat for Humanity employed counselors and advisers for people who had fallen behind on their mortgages, property tax payments or both and were in danger of foreclosure.
Advisers would help people work out lower payment schedules with lenders or even arrange to "short sell" a home at a loss rather than going into foreclosure, said Stephanie Galvin of the Albany County Rural Housing Alliance.
While New York so far has escaped the tidal wave of outright foreclosures that have hit Sun Belt states like Florida and Nevada, thousands of residents are barely hanging on to their homes. Falling behind on taxes and mortgage payments are signs that eventual foreclosure looms in the future.
In Albany County alone, nearly 4,000 dwellings are in foreclosure or are more than 60 days behind in their payments, advocates said.
In some cases, people simply walk away from their homes when they fall behind, assuming the bank will take it. But experts said banks don't really want abandoned homes and the dwellings can fall into a state of limbo that can blight a neighborhood.
Eliminating the assistance program comes as Cuomo's Financial Services Superintendent Benjamin Lawsky is launching a new unit that, like the $25 million program, aims to help homeowners facing foreclosure.
But Lawsky has said there is little money to go with that program.
"They don't have that much money to run that unit," said Susan Cotner of the Affordable Housing Partnership, a Capital Region organization that works on housing issues.
But Vito Lopez, the Brooklyn Democrat who chairs the Assembly Housing Committee, warned that advocates would be competing with a galaxy of groups and interests, all jockeying for money as lawmakers and the governor have to close a $2 billion deficit.
"You people have to get out there," he said, explaining that advocates need to make themselves heard and visible, especially since Cuomo is getting thousands of phone calls from people and groups seeking money in the state budget.
"How do you get across the finish line? That's the challenge," he said, adding "I have seven meetings (on Tuesday) about people that need money."
rkarlin@timesunion.com • 518-454-5758
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