Op-Ed: Programs Have Helped N.Y. Homeowners

Op-Ed Published in the Press & Sun Bulletin

By Eric T. Schneiderman

Across our state, cities and towns still suffer from the crash of America’s housing market that sent our economy into freefall. The downward spiral of foreclosures, abandoned homes, declining property taxes and destabilized neighborhoods has taken an enormous toll on municipalities statewide.

In some communities, streets are lined with abandoned homes that attract criminals and vandals, drive down property values and impose financial burdens that cities and towns cannot afford.

As attorney general, I have been recovering funds from some of the banks whose conduct contributed to the market crash. Under our settlement agreements, these banks are providing real relief to both New York families and municipalities, and I have proposed legislation to extend that aid even further.

When I took office in January 2011, 345,000 New York families were facing foreclosure and half of those families had never spoken to a lawyer at any stage of the process. In response, we created the Homeowner Protection Program (HOPP), a network of free housing counseling and legal service providers serving families in every community in our state.

There are now more than 90 HOPP grantees across the state — including in Broome County, which has had more foreclosures than any other county in the Southern Tier.

Since the HOPP program began in October 2012 through the end of 2013, our service providers have helped nearly 24,000 homeowners. More than 6,660 of those families have already received mortgage modifications or have modifications pending.

Our efforts extend beyond individual homeowners. To aid communities plagued by abandoned and derelict properties, we dedicated $20 million of the settlement funds to support land banks — nonprofit organizations that help local governments buy up abandoned properties that can be rehabbed and resold, or be torn down, so the properties can be reused.

We have distributed nearly $13 million to eight land banks — including in Broome and Chautauqua counties — and another $7 million will be awarded through a competitive process this summer. Current state law allows only two more land banks to be created, but many more communities could benefit from access to these valuable resources. That is why I proposed legislation to raise the maximum number of land banks from 10 to 20.

I also want to address another challenge for our towns and cities — zombie properties. These are homes that residents abandon after receiving a foreclosure notice, and that sit uncared for because banks don’t have to take responsibility for derelict homes until the foreclosure process is complete, and that can take months or years.

Leaving these houses to rot is unfair to municipalities and taxpayers. So I am introducing legislation to force banks to shoulder the burden of these zombie properties far earlier in the foreclosure process.

RealtyTrac data show that four of the 10 New York counties with the highest percentage of zombie foreclosures are in the Southern Tier — Chautauqua, Chemung, Steuben and Tioga. RealtyTrac estimates there are 15,000 zombie properties statewide, with nearly 1,000 across the Southern Tier. But research by my office has found that these numbers are probably too low. The truth is that no one really knows how many zombie homes there are.

My bill would create a statewide registry to help municipalities and regulators figure out which properties are zombies and who is responsible for them.

Displaced families, vacant neighborhoods and destabilized communities threaten cities and towns all across our state. As attorney general, I am proud to have assisted homeowners and communities all over New York, and I will do everything I can to further that recovery even more.