Roxanne R. is a southeast Queens resident trying to swim to shore from an underwater mortgage.
Her house is worth less than her unpaid mortgage balance.
To protect homeowners like Roxanne, who are at risk of foreclosure, several city councilmen and advocates are calling on City Hall to use eminent domain to reduce foreclosures, especially in African-American and Latino neighborhoods.
“The utilization of eminent domain to resuscitate properties burdened by underwater mortgages will have a positive impact on communities devastated by the foreclosure crisis,” said Councilman I. Daneek Miller (D-St. Albans).
Miller pointed out that southeast Queens “has some of the highest home ownership in the city and have been disproportionately affected by this crisis without a solution.”
The power of eminent domain allows municipalities to buy toxic underwater mortgages, so homeowners can sign a new loan offering the banks a fair market value of their properties.
Homeowners fend off foreclosures by paying lower monthly payments to banks.
According to a report released last week by New York Communities for Change, a coalition of working families in low- and moderate-income communities, 17 out of 20 ZIP codes in the city with the highest number of underwater mortgages have populations with more than 50 percent of the residents African-American or Latino.
The report, “Thousands of Homeowners Still Drowning in Underwater Mortgages,” reveals that more than 24,000 of the underwater mortgages in the city “are toxic private-label securitized mortgages.” Of those, 1,490 are in St. Albans, 1,431 in Laurelton and 882 in Jamaica.
“Many New Yorkers are still hurting from the housing crisis,” said Councilman Donovan Richards (D-Laurelton). “Those who have not yet lost their homes are on the brink of losing it in the near future. Eminent domain can remedy the failures of mortgages services.”
The report points out that “principal reduction modifications are necessary to turn the tide and to prevent an ongoing crisis.”
“Like many families in Queens, I have been on the brink of foreclosure for too many years,” said Jean Sassine, from New York Communities for Change. “It is time for the city to step in and do everything in its power to save our neighborhoods.”
Councilman Jumaane Williams (D-Brooklyn), chairman of the Council Housing and Buildings Committee, said use of eminent domain “should be explored as a tool,” adding that “we must act to end the foreclosure crisis.”
Roxanne R. supports the use of eminent domain to mitigate foreclosures.
“This is the best solution to save our homes and our neighborhoods,” she said.
Reach reporter Juan Soto by e-mail at firstname.lastname@example.org or by phone at 718-260-4564.
©2014 Community News Group
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