Unfortunately, many people caught up in the 2008 financial crisis lost their homes to foreclosure. In fact, some homeowners in Long Island are still reeling from the crisis, or have their own personal financial crises that have made it difficult, if not impossible, to repay their mortgages. However, mortgage scams abound, preying on desperate homeowners.
New York Attorney General, Eric Schneiderman, recently announced that the Homeowner Protection Program, which assists those in New York who fell victim to foreclosure scams, will receive an additional $20 million. These funds are available through a settlement with financial institutions that were part of the 2008 financial crisis. With these extra funds, the program will expand counseling and legal services at no charge for those facing foreclosure.
Foreclosure scams often pledge to homeowners in crisis that they can negotiate a lower monthly mortgage payment on the homeowner’s behalf. In exchange, they ask that homeowners pay them up-front. But, no negotiations are ever made, and the scammers leave the homeowners in a worse off place.
The New York City Department of Finance stated that as of February 2016, more than 525 investigations of mortgage scams were open, affecting over 670 properties in New York. Since 2012, the program has helped more than 70,000 families.
Hopefully, with the increase in funding, the Homeowner Protection Program will help more homeowners in Long Island and across New York, who were subject to foreclosure scams. However, those in New York who are facing foreclosure do have feasible options.
One option, for some, may be filing for bankruptcy. Bankruptcy can put a halt to the foreclosure process, giving the homeowner the time needed to catch up on their delinquent mortgage payments, liquidate their assets or create a court-approved repayment plan, depending on the type of bankruptcy.
Source: New York Daily News, “State program offers free services to New Yorkers on verge of foreclosure,” Stephen Rex Brown, Dec. 14, 2016