Legislation sponsored by Chairman of Assembly Banking, Darryl Towns, Governor David Patterson, and a number of other Assemblymen and Senate leaders has been passed into law. This foreclosure bill is designed to prevent people from losing their homes by providing a mandate to avoid crisis of a similar nature in the future. The foreclosure bill takes into cognizance the value of having the correct balance between the availability of affordable credit and consumer protection.
The bill which was passed in June by the New York Legislature works in two ways, by assisting New Yorkers who are currently facing foreclosure to prevent it by tackling the flaws in New York banking regulations, and by serving as a model for federal action.
Thousand of families have lost their homes to the foreclosure process and New York has been driven into recession by Wall Street woes. The New York Foreclosure Bill is seen as a responsible action to protect these families. These politicians have found that banking regulations need to be reformed to ensure that this crisis never happens again. The New York foreclosure bill is designed to accomplish this and also to spur the federal government on to do the same.
These politicians have been very outspoken about the foreclosure crisis, and this foreclosure bill is critically needed at this point in time. Essentially the Government is turning its back on families who are in danger of losing their homes to foreclosure. Calling the Federal Government to action on the foreclosure crisis means that stronger laws should be passed to prevent lenders from preying upon families and their livelihoods.
Information from the NY State Banking Dept.indicates that as many as 1 in 200 homes in this area are in undergoing the foreclosure process. Areas such as Albany, Monroe, Long Island, Brooklyn and Queens are all being unfairly impacted by this. The foreclosure bill calls for lenders having to send a pre-foreclosure notice at least ninety days prior to the pre-foreclosure process. Hopefully this will encourage home owners to seek help in the pre-foreclosure period, and lenders would also be required to list with government approved housing counselors.
By the same token, Governor Arnold Schwarzenegger is also looking to pass a similar foreclosure bill in California. This is as part of his plane to spur the economy in California, these proposals have not yet been made law. However they are designed to ensure that lenders offer and deliver relief to beleaguered home owners.
The Governors foreclosure bill would ensure that for the next four years lenders, as in New York, would be required to wait and additional ninety day period before selling the home of a mortgage defaulter. This plan would see lenders having to adopt provisional interest rate cuts or some other such technique to reduce monthly repayments and make them affordable and also encourages lenders to rework loans without massive debt write-offs. This would offer immediate relief to home owners, but would require both them and the lender to suffer some pain in the long term.
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Kevin Simpson, GM Sales & Marketing