In the current economic climate, every single day, 22 Brooklyn families lose their homes to foreclosure. Across the country, upwards of one million families were similarly affected in 2007, with an increase of 40 to 50 percent predicted for 2008, making the current foreclosure crisis a disaster of epic proportions across the United States. For this reason, advocates for those who are battling to keep their small piece of the American dream, say that the time has come to do something legislatively to reconfigure the playing field somewhat. To that end, a Brooklyn Democrat and a Queens Republican have teamed up to sponsor legislation that, they hope, will stanch the bleeding in neighborhoods around the state and particularly across both boroughs, where fueled by an explosion of sub-prime lending that has been especially an issue in communities of color the emergency has been particularly severe. In 2007, according to statistics reported by Realty Trac, there were 59,000 filings involving 39,000 homes in New York State, with 66 percent of filings occurring in New York City. In particular, approximately 40 percent of the foreclosures in the state occur in Brooklyn and Queens, according to Assemblymember James Brennan. Brennan, along with State Senator Frank Padavan, has introduced legislation that would impose a year delay on foreclosures, to give borrowers and lenders the opportunity to renegotiate their loans a move that they and their co-sponsors hope will stop the downward spiral whose impact goes beyond individual homeowners and lending institutions to impact communities, as well as the state and local governments. The moratorium would kick in, according to the memorandum in support of the bill, once a bank has proven its entitlement to foreclosure, delaying for a year the actual court order which transfers title and enables foreclosure to proceed. We are facing a crisis in which hundreds of thousands of New Yorkers homes may be in foreclosure in the next several years, Brennan warned. It is imperative that we freeze the frame, stop foreclosures from going forward as we work out sustainable solutions, added Rebeca Gamez, community education coordinator of the Neighborhood Economic Development Advocacy Project (NEDAP), which has been tracking foreclosure data around the city. In a press conference held at Brooklyn Borough Hall, 209 Joralemon Street, Brennan said that the moratorium legislation offers, One of many tools that will be needed as the national crisis emerges. It is critical that such a tool rapidly be made available, he added. Indeed, Brennan stressed, Even if Congress acted tomorrow with the president, it would take years to enact interventions that would resolve this national crisis. For his part, Padavan told his listeners that the legislation was, Not a bailout, not a taxpayer-funded program. What it is, is a way of helping both lenders and homeowners from being put into a situation that neither wants to be in. The critical need for action, he added, is underscored by the steep increase in foreclosures 70 percent since 2005, he said. That shows how the train is accelerating, Padavan emphasized. We want to bring brokers and mortgage providers to the table with homeowners to work it out in a way thats reasonable so people stay in their homes. That can only be done if we authorize courts to mandate it should be done. It is important for New York State to take the lead, opined Brooklyn Borough President Marty Markowitz. The immediate passage of this bill is important because it can give at-risk mortgage holders in New York one full year to save their homes, Markowitz stressed. Many of our residents work hard to achieve the dream of home ownership, only to have that dream turned to ruin because of predatory lending, mortgage fraud, and reset mortgage payments that double, triple, even quadruple in value. The federal government has to stand up and intervene, he went on. Till that happens, we need to pass this foreclosure moratorium. The crisis is not abstract, added Bertha Lewis, the executive director of ACORN. Rather, she said, It has a face, introducing Violet McCurchin, a Brooklyn homeowner who has an adjustable mortgage that, McCurchin acknowledged, Is likely to change very soon. I could be in a position where I could no longer continue to meet my payments. Ive been trying for the past year to have a refinance done or put myself in a better situation, McCurchin told the group, But thats not happening. We really need to have something like this in place to bring the parties to the table. Violet, noted Lewis, is multiplied by millions across the country. And, she added, its not all because of sub-prime loans. We have folks who have got prime loans, Lewis emphasized. This crisis is across the board. In 2007, 1.1 million homes entered foreclosure. That means 301 families every single day in this country are being foreclosed on. They are in the American nightmare. The effect of foreclosure, Lewis added, goes beyond the effect on individual families. When you foreclose a home, the value of the entire street goes down 20 percent, she said. Theres no tax base on the home, so you cant fund schools, police, firefighters. Crime rises. City revenue falls. State revenue falls. Everyone loses. Should the foreclosure moratorium become law in New York State, it would not be the first time the state has imposed a moratorium on foreclosures. In the aftermath of the Great Depression, from 1933 through 1949, A mortgage foreclosure moratorium was the law in New York, said Brennan. A similar law, passed in Minnesota, was upheld by the U.S. Supreme Court in 1934, he added, stressing, There is no legal impediment to our adopting this legislation to protect homeowners in Brooklyn and Queens and across New York State. So far, 74 assemblymembers and 23 state senators have signed onto the legislation, which was introduced on January 16th.
©2008 Community News Group
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