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New York Homeowners in Foreclosure May Get More Time

Long Island Foreclosure Notice Law stopping foreclosureWritten by Craig D. Robins, Esq.

        This past September, Gov. Patterson and state legislators agreed to slow down the foreclosure process by imposing a new law that required mortgage lenders and banks to provide delinquent homeowners with a 90 day notice of their intent to commence foreclosure. Now, Albany lawmakers, fearing the recession will produce more home evictions, plan to examine the effectiveness of this 90 day warning period and whether additional time is needed.

        The purpose of the 90 day notice is to give homeowners the opportunity to try to reach a settlement with their lender before the foreclosure proceeding is commenced.

        Judging from my own experience with Long Island consumers who have fallen behind, communicating with a mortgagee can be very time consuming and frustrating. Ninety days is often an insufficient period of time to work out debts with a lender. Many mortgagees are also unreceptive and indifferent to modifying their customers’ mortgages.

        Long Island State Senator Brian X. Foley (D – Blue Point), who just became the new chairman of the Senate Banks Committee, will be holding hearings on this issue. Last year, when he was campaigning, he actually backed a one-year moratorium on foreclosures.

        Suffolk County and Nassau County have among the highest mortgage default rates in New York. Many homeowners are able to stop foreclosure and cure their mortgage arrears by filing Chapter 13 bankruptcy.

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