DHCR Announces Grants to Address Subprime Foreclosure Crisis

ALBANY, NY (04/05/2010)(readMedia)-- The State Division of Housing and Community Renewal (DHCR) today announced six awards totaling $3.5 Million that will help at least 10,000 New York homeowners to avoid foreclosure and potential homelessness. The grants were made to not-for-profit housing counselors to provide outreach, education, financial counseling and legal representation to vulnerable homeowners with subprime mortgages.

Governor David A. Paterson said the awards "will help to safeguard our neighborhoods from the decay caused by foreclosure. Foreclosed and vacant homes hurt property values and can attract criminal activity. We will do everything in our power to protect our communities and to help keep vulnerable New Yorkers in their homes."

The awards were made through DHCR's Subprime Foreclosure Prevention Services program, part of a comprehensive plan initiated in New York State to address the foreclosure crisis.

Acting DHCR Commissioner Brian Lawlor noted that the foreclosure prevention services are available free of charge and warned consumers to beware of solicitors who offer foreclosure assistance for a fee. "Since the beginning of the foreclosure crisis, we have seen an increase in the number of suspicious businesses that use pressure tactics and promises of quick results for a fee – usually a very high fee. We want all consumers to be aware that DHCR has funded reputable housing counselors in every part of the state that offer their services at no cost. I urge any homeowner with a subprime mortgage to reach out to one of these counselors at the first sign of trouble."

Grants were made to housing counselors serving regions of the state that have been particularly hard hit by the subprime mortgage foreclosure crisis, including South Queens in New York City, the City of Buffalo and Nassau, Suffolk, Westchester, Orange and Rockland Counties. The housing counselors partner with other groups and agencies in the region to provide free counseling and legal services to vulnerable homeowners.

All the agencies awarded grants have had great success providing foreclosure prevention services, and all the agencies exceeded their projected goals last year, helping many more homeowners than they had proposed in their applications for funding.

The grants were made to:

• $550,000 for the Economic Opportunity Council of Suffolk, Inc., which is partnering with Health and Welfare of Long Island (HWCLI), and Touro Law School's Public Advocacy Centers Foreclosure Prevention Clinic to provide services to residents of Suffolk and Nassau Counties. The group has proposed serving 2,103 households with the funds. Last year, the group's contract called for them to serve 2,375 households, and they actually provided services to 3,135 homeowners. Suffolk County ranks second and third in the State respectively among all counties with foreclosure filings.

• $388,500 for Rockland Housing Action Coalition, Inc. (RHAC) which is partnering with Legal Aid Society of Rockland County (LSRC) Rockland County Office of Consumer Protection (RCOCP) and the District Attorney's office of Rockland County (DARC) to serve Rockland, Westchester, and Putnam Counties. The group plans to provide services to 750 homeowners. Last year, the group proposed serving 600 homeowners, and actually served 664. Rockland ranks number 11, Westchester is fifth and Putnam is number 16 among all counties with foreclosure filings.

• $645,350 for Neighborhood Housing Services (NHS) of Jamaica, which is partnering with Centro Hispano Cuzcatlan , Queens Community House and MYF Legal Services to provide foreclosure prevention services in Southern portion of the Borough of Queens, the single-hardest hit region of the state. Last year, the group was contracted to provide services to 700 homeowners, and actually helped more than 1,165. For 2010, the group has proposed serving 1,550 homeowners.

• $800,000 for the Western New York Law Center, Inc. (WNYLC) which will serve the residents of Erie County together with their partners Homefront, Inc., Western New York AmeriCorps. Last year the group proposed serving 4,616 households, and actually provided services to 7,287. This year, the group has proposed serving 1,750 households. Erie County ranks sixth among counties for foreclosure filings.

• $500,000 for the Orange County Rural Development Advisory Corp. (ORDAC) which is partnering with Empire Justice Center, Orange County Woman's Bar Association, Fannie Mae, Freddie Mac, National Association of Realtors, United Way, Leadership Orange, Crystal Run Village, Independent Living, Department of Social Services, Literacy Orange, Newburgh Free Library, Office for the Aging, Association of Towns, Walden Savings Bank, National Association of Professional Mortgage Women, Orange County Office of Community Development, Office of Mental Health, Chase Homeownership Center, Rockland Housing Action Coalition, Hudson Valley Foreclosure Prevention Services, Pro Bono NY Orange County Local Action Committee, Orange County Bar Association and Legal Services of the Hudson Valley. Last year, the group proposed providing outreach, education, counseling and legal services to 500 homeowners. They actually provided outreach to 594, counseling to 444 and referrals to 599. For 2010, they propose providing services to 1,750 homeowners. Orange County is ranked tenth among New York's counties for foreclosure filings.

• $612,590 for Westchester Residential Opportunities, Inc. (WRO) which will partner with Legal Services of the Hudson Valley (LSHV) to provide services to Westchester County, which is ranked fifth among New York Counties for foreclosure filings. Last year they proposed providing services to 825 households, and in the end had served more than 3,200. In the new contract, they have proposed providing services to 1,589 homeowners.

Due to the ongoing problems associated with foreclosure, the 2009-10 New York State budget appropriated nearly $22 million to continue the State's foreclosure prevention effort started in the previous budget year. The new funds have been allocated from the Fiscal Stabilization Fund provided to the State under the American Recovery and Reinvestment Act (ARRA). Proposals under this program will be accepted on a continuous basis through August 1, 2010 or until discontinued by the State's Housing Trust Fund Corporation.

In addition to funding counseling and legal services, New York's extensive response to the mortgage crisis includes: mandatory settlement conferences to protects tenants from premature evictions; outreach and loan modification events that bring homeowners face-to-face with lenders and servicers; refinancing and mortgage programs such as the new forty-year fixed rate mortgage through the State of New York Mortgage Agency; neighborhood stabilization initiatives to return foreclosed properties to productive use and enforcement actions through the creation of a Mortgage Fraud Unit within the Banking Department.

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