Many distressed homeowners in New York do not realize they are eligible for help paying their mortgages, but the state is trying to change that, the state’s top law enforcement officer said Friday.
A new $60 million program seeks to connect more families with mortgage assistance by providing housing counseling and legal advice, state Attorney General Eric Schneiderman said at the annual meeting of the Long Island Housing Partnership, held at Crest Hollow Country Club in Westbury.
Last week, Schneiderman announced the launch of the three-year program, which is funded by this year’s $25 billion settlement between major mortgage lenders and federal and state agencies. The accord resolved allegations that lenders foreclosed without proper documentation.
The settlement could lead to $500 million in loan modifications and $140 million in refinancings in New York, according to estimates by the federal Department of Housing and Urban Development, Schneiderman said.
In addition, on June 1 the federal government expanded the pool of homeowners who are eligible for the Home Affordable Mortgage Program, or HAMP, which aims to modify the loans of distressed homeowners, Schneiderman said.
Homes that are under water -- in other words, their outstanding mortgage balance is greater than the home’s value -- are a big contributor to the nation’s continuing economic woes, Schneiderman said.
“We’ve got to get everyone in New York who’s eligible for principal reduction, eligible for rate reduction -- eligible for any of these programs that are out there -- to take advantage of them,” Schneiderman said. “I want the highest participation of any state in the country. If we do that we will lift our housing market, and if we do that, we will lift our economy and we can get back on track.”