Governor Paterson, Senate Majority Leader Bruno, and Assembly Speaker Silver Agreement on Subprime Will Help Thousands in Foreclosure
Statement by Lois Aronstein, AARP NYS Director
ALBANY, N.Y., June 20 /PRNewswire-USNewswire/ -- AARP commends the Governor and the Legislature for reaching an agreement on legislation to address the housing foreclosure crisis in New York State. With over 1,100 foreclose filings a month in New York, the relief this legislation will provide is greatly needed. The foreclosure crisis has hit the subprime marketplace the hardest, where many low- to moderate-income people as well as older adults have obtained their mortgages. Borrowers age 65 or older are 3 times more likely to hold a subprime mortgage than borrowers less than 35 years of age. According to public statements by our state leaders, the agreed-upon bill will require lenders to send pre-foreclosure notices to borrowers at least 90 days before foreclosure proceedings begin and will require mandatory settlement conferences for foreclosure proceedings. The legislation will allow borrowers time to seek help from a list of government approved housing counselors. The remedies in this legislation will work in conjunction with the $25 million the Governor and Legislature recently approved in the state budget to increase funding for housing counsels and legal assistance. The proposed law will also help keep a similar foreclosure crisis from happening again by ensuring sound lending in the suprime marketplace by requiring lenders to verify a borrower's ability to repay a loan. This will require lenders to make a reasonable and good faith determination of the borrower's ability to repay the loan, including the principal, interest, taxes, insurance, assessments, points, and fees. The agreed-to bill also requires brokers to act in the borrower's interest by recommending loan products that would be appropriate to the borrower. Additionally, this legislation will make mortgage fraud a crime. The proposal as it currently stands will not apply to those individuals now saddled with bad loans in the subprime market place. These loans will undoubtedly lead borrowers, especially those with adjustable rate mortgages, down the road to foreclosure. AARP strongly believes that the overall agreed-to bill will help those currently in foreclosure and will save thousands of New Yorkers from losing their homes, which for most is their single biggest asset. All New Yorkers should applaud the Governor, Senate Majority Bruno, and Assembly Speaker Silver for their sound leadership and working to achieve this historic agreement to address the foreclosure crisis.
SOURCE AARP New York State
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