Right now, New York is setting an example for the nation. The state saw an 11% decline in foreclosures whereas there was a 22% increase in foreclosures nationwide over last year. In December 2009, Governor Paterson signed a new law that expands current protections for sub prime borrowers. The law includes a 90-day pre-foreclosure notice and mandatory settlement talks – to cover all home loans. The New York law also guards tenants of foreclosed building from unexpected eviction. It enables the tenants to stay in their homes for at least 90 days after a foreclosure notification, or to the end of the lease, whichever is longer.
Residents cannot be unexpectedly kicked out of their homes and onto the streets. Instead, they will have three months or longer to put their finances back together, find other sources of income, or find a new place to live. Paterson’s law should be followed in other states since it prevents the problem of people crowding into motel rooms, a health hazard, or onto the street while empty houses sit boarded up.
The new law also mandates that lenders must cover the ...
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...ven more dependent on government-funded programs, sapping the economy of resources that would be put to better use by ensuring such families remain in their homes.
Foreclosure does not just mean foreclosure. It destroys a way of life and can destroy families. It ruins neighborhoods and drives down property values. It allows large companies to buy up devalued properties, when instead more families should be in those homes, not another Wal-Mart or Home Depot. The fewer foreclosures this country sees, the better the economy will do. There are many different ways we are going to have to try to solve this problem, but the New York law is proven to have worked and thus should be applied nationwide. Incentives, not shame, will encourage lenders and their employees to do a better job of seeing that the loan modification program reaches all the people it needs to help.
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