New York Foreclosures On An All-time High

One of the world’s most densely populated cities in the world, New York is facing yet another threat. This one being the threat from foreclosures. The number of homeowners in NYC, facing the threat is on all time high. It is estimated that the number of foreclosures this year will reach a record highest.

According to reports submitted by the neighborhood Economic Development Advocacy Project, foreclosure auctions on 3000 homes was conducted by lenders since January this year. It is expected that the number is going to rise by the end of this year. According to research, the number will rise above 14000 and this number represents a 60 percent increase from 2006.

Sarah Ludwig, executive director of NEDPA, suggests that homeowners and investment companies should gear up for tough times as things will become worse before there is even slight improvement in the condition.

The major cause of increase in the number of closures this year is attributed to the increase in the sub prime adjustable rate mortgages. There will be changes in the subprime ARM in the coming six to eighteen months. If this happens, homeowners may have to sell their homes to mortgages. This they have to do in order to clear mortgage payments that increase by hundreds of dollars every month. Due to this middle-class neighborhood, where bad loans is common will be hard hit. Neighborhood like Bedford STUYVESANT, Flatbush and East New York-all of which are situated in Brooklyn are the hardest hit says NEDPA. Two of them in in Queens- Rochdale and Jamaica are also suffering from foreclosures.

Agencies and housing group are intervening to bring the situation under control. The State of New York Mortgage on Friday announced that they will invest $100 million to help homeowners to refinance their homes. Nevertheless, it is unlikely that the amount put in will be enough as the number of homeowners at the risk of foreclosures is much more. The State has put in money enough for about 500 homeowners statewide. Plus, owners of multiple family homes are not eligible.

Housing counseling agencies like Neighborhood Housing Services of New York Inc. are being flooded with phone calls of grieving homeowners. It has received 800 calls per month as compared to 300 it received last year.

The increase in the number of homes lost either through forced sales or foreclosures have one common effect- detoriating neighborhoods. The homes, especially single family homes, as a result of this are not being well tended. This is something that is not seen in years and is a cause of worry, says Sarah Gerecke, NHS executive director.

Popularity: 3% [?]

Bookmark to: