Since the recession and financial crisis began in 2008, many New York residents have faced a wide range of financial challenges and setbacks. People have experienced job loss or reduced hours and extended unemployment, which frequently cause difficulty in paying bills. Homeowners have had to worry about losing their homes when the mortgages become too expensive and their homes are no longer worth what they were when they bought them. Foreclosure was a real and imminent concern for many people.
Thankfully, the housing market has begun to rebound nationwide and recent data indicates only 47,000 completed foreclosures in May 2014 as compared with 52,000 in May 2013. Despite these improving numbers, however, the current monthly number of foreclosures is still well above the average of 21,000 foreclosures that occurred per month from 2000 to 2006. Some states are still struggling with high numbers of foreclosures, and New York is in the top five states in the country for foreclosure inventories. New Jersey, with nearly 6% of all mortgaged homes being in foreclosure, was at the top, while New York comes in third with 4.3%.
For many homeowners, losing their homes is one of their greatest fears during times of financial strain. A house represents not only the place where they and their families live and make memories, but also a huge financial investment. Losing a home in foreclosure often means losing all the money that was put into the home over the years. Fortunately, there are many options for New York homeowners facing the possibility of foreclosure.
After consulting with an attorney experienced in bankruptcy and foreclosure, homeowners may be able to negotiate with the mortgage lender to avoid foreclosures. Depending on the value of the home, it may be possible for a homeowner to negotiate to eliminate a second or third mortgage. Bankruptcy is also a viable option that many people overlook initially. Under Chapter 13, a person can restructure mortgage payments which will give a homeowner more time to become current on past-due payments.
Source: Wall Street Journal, “5 states with the most (and fewest) foreclosures,” Quentin Fottrell, July 8, 2014