Homeowner advocates said Tuesday that an array of counseling and legal assistance programs for people facing foreclosure is endangered by cuts in Gov. Andrew M. Cuomo's proposed state budget.
The new budget eliminates funding -- previously totaling as much as $25 million a year -- for the Foreclosure Prevention Services Program, which was created in 2008 as subprime mortgage holders began defaulting on their loans.
Homeowner advocates are hoping to get the state legislature to restore the funding. "If we don't get this funding restored in the budget, services will go away for homeowners," said Kirstin Keefe, senior staff attorney at the Empire Justice Center in Albany, which provides legal help statewide for the poor and received some of the endangered funding.
The program is limping along now on $1 million to tide it over until the new budget takes effect April 1.
At the Long Island Housing Partnership in Hauppauge, foreclosure prevention manager Carol Yopp says her group had been getting the endangered funding but has had to let go a counselor and an administrative assistant, leaving herself and one other counselor and one part-time assistant.
"And the clients are still coming in," she said.
Many experts predict a surge in new foreclosures this year as lenders untangle paperwork logjams. Cuomo has announced plans to set up a new Foreclosure Relief Unit within the Department of Financial Services to offer counseling, while the state Attorney General's office last week announced plans to distribute $1 million to nonprofit legal aid groups to help homeowners facing foreclosure.
Spokesman Morris Peters in the state budget office says of the new unit, "We believe the same level of services can be provided by this new entity."
But homeowner advocates contend that those two programs will be too limited to replace the program whose funding is being eliminated.
For now, it has had to let go one of two paralegals and two attorneys, leaving one full-timer and one working part-time on foreclosures. It is reluctant to initiate new court cases, which almost surely would still be in litigation when the short-term funding runs out at the end of March. "We're operating at less than normal," he said.