This Foreclosure Buzz for the Residents…
Lesley Grimm reports that Brooklyn house owners are facing a foreclosure crisis. New hotline can be established for help. There are thousands of house owners facing heavy mortgage lapses with foreclosure threats. However sound, unbiased advice is readily available on the phone. The step was most welcome by affected New Yorkers.
A novel Foreclosure Prevention Help line (212-669-4600) has been initiated by the City Comptroller, William Thompson Junior, to the succour of New Yorkers struggling against odds.
Addressing a May Day meeting of the Sheepshead Bay/Plumb Beach Civic Association, the Associate Director of the Comptroller, Bruce Solomon, said that the crisis cuts across all factors related to economics, race, colour and creed differences. People have bought million dollar houses believing that they can afford these only to find out quickly that it is well beyond their means to continue to make payments.
The burgeoning popularity of sub-prime lending has forced this situation upon the owners. Records testify that low and middle-income groups have become victims of these non-traditional mortgage schemes. On the one hand it has made it possible for house owners to avail of property they had never dreamed of but on the other the risk from default is greater. Initially the sub-prime loans appear affordable with a low ‘teaser’ interest.
But problems surface after two or three years when rates begin to get heavier and heavier. Bruce Solomon did not mince words when he said that these low interest rate dreams have fallen by the wayside.
Figures talk explicitly of the explosive situation. Neighbourhood Economic Development Advocacy Project says that according to statistics the foreclosure figure could cross 15,000 – that is more than double the figure of the total of the last two years. Senator Schumer is of the grave opinion that within the next two years 81,000 of New York house owners may forfeit their homes; of these 6,100 are from Brooklyn.
Seen against the backdrop of New York having the lowest house ownerships the scenario is particularly disturbing pointing to things to come in other metropolitan areas. It is high time that the authorities roped in some sort of order in this free-for-all wild zone of mortgages. Schumer has initiated three steps to tackle the menace – firstly a national regulatory system for mortgage brokers, secondly to get rid of false loans (loans mathematically pre-planned to trip the borrower) and finally to set up a foreclosure task force in New York State.
