Mark Winston Griffith

NYS Democrats Consider Foreclosure Crisis

"Wait and see" is probably the best advice any one could give homeowners who are looking for political leadership in the subprime lending and foreclosure crisis in New York. But at least some New York State elected officials are beginning to stir from their long legislative sleep at the wheel.

Last week New York State Senate Democrats came out with a report and a series of proposed legislative initiatives aimed at helping New Yorkers with subprime mortgages save their homes. One key provision in a proposal announced by Senators including Jeff Klein, John Sampson, Malcolm Smith and Liz Krueger was a six month moratorium on foreclosures of subprime loans. Although the details are anything but spelled out, what this suggests is that anyone who is in default of a subprime loan in New York will have the legal watch stopped until, presumably, a solution can be worked out, or at least attempted, with the lender.

Obviously, anything resembling relief for people in danger of losing their homes is exciting. But advocates and others on the sidelines are eagerly awaiting details of the proposal. The fact that lenders can, with this proposal, voluntarily decide whether or not they want to actually participate in this initiative casts some doubt on the ultimate effectiveness of a moratorium. And even a mandatory moratorium would have to be part of a much larger set of legislative remedies to order to mean very much, but again, at least this is a start. The task now for advocates is to let Senate and Assembly leaders know what an appropriately more comprehensive set of policy responses might look like.

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Posted at 8:41 AM, May 11, 2007 in
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