Few Bank Foreclosure Properties Settlement in New York Courts

by Peter Vernon on States

New York courts were able to settle a meager number of Bank Foreclosure Properties cases since last year. According to data released by Senator Jeff Klein and Assemblyman Hakeem Jeffries, 96 percent of almost 2,756 foreclosure court conferences have yet to be settled.

However, the 2,756 foreclosure court conferences covered various time periods for New York City and Long Island municipalities. For example, court conferences data in Suffolk included only the month of April, not enough time for foreclosure court conference settlement.

Aside from the lack of time, many court conferences get postponed for one reason or the other. According to the report released by both Klein and Jeffries, Suffolk, which just started its program of foreclosure court conference, had scheduled 21 settlement meetings in April.

Klein’s office explained that since Suffolk just started its program in April, only a month’s data was available.

The data showed that from January to April of this year, Nassau scheduled 1,032 foreclosure court conferences in which 30 cases were settled, representing 2.9 percent of the total cases.

In Queens, there were 1,032 scheduled foreclosure court conferences from October 2008 to April of this year. Out of these 1,032 cases, only 16 were settled or 3.8 percent.

The state had passed a law mandating court conferences to help distressed homeowners avoid foreclosures and protect them from predatory lending and fraudulent foreclosure prevention schemes.

Meanwhile, both Jeffries and Klein have proposed a law that would establish a foreclosure diversion program. The proposed program would require distressed homeowners to call first the New York banking department to request for counseling sessions with certified counselors. Both the distressed homeowners and counselors would file financial plan 10 days prior to the foreclosure court settlement.

In the event that lenders accept the financial plan, a certificate of understanding will be filed with the courts. Homeowners who requested for a settlement conference are not required to attend the meetings.

However, if lenders reject the financial plan, both parties will be required to appear before the court to work out a temporary payment schedule for a maximum of nine months or until a permanent solution have been reached.

Klein said that the current foreclosure prevention efforts in the state have failed to meet their goals. He believed that the proposed bill would help more distressed homeowners avoid Bank Foreclosure Properties.